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ALP (Arcadeum's LP Token) is a single-asset liquidity pool that entitles liquidity providers to a cut of the house proportional to their deposit.
USDT is the pool's base asset, but zap deposits routed through Uniswap are supported via Arcadeum's web interface, with no additional fees.
As the pool increases and decreases in underlying USDT, depositors assume linear risk/reward. For example, if a user deposits $100K, bringing the pool to $1M:
- If the pool climbs to $1.1M, the user's position will be worth $110K, for a PnL of $10k. (assuming no other deposits/withdrawals)
- If the pool dips to $900K, the user's position will be worth $90K, for a PnL of -$10k. (assuming no other deposits/withdrawals)
Q: Why USDT and not USDC? A: USDT was chosen out of consideration for Circle's USDC terms of service, which prohibits the use of USDC for gambling.
Q: Are there fees? A: ALP has no carry or performance fee. However, ALP has a deposit and withdrawal fee that is capped at 1.00%. VIP users enjoy lower deposit and withdrawal fees. Accrued fees are rewarded to staked ARC derivatives.
Q: Is there a cooldown? A: No.
Q: Is there a way for anyone else to deposit or withdraw on my behalf? A: No. Only you can control your ALP and its underlying USDT.
Q: Is ALP solvent? A: Always. ALP uses no leverage and its underlying USDT has no exposure to third-parties, such as external decentralized finance protocols.