How to launch liquidity for a yield-bearing stablecoin
NAV-centered ranges, mint/redeem rebalancing, and dynamic fees.
Liquidity for a yield-bearing stablecoin should launch as a concentrated position against a major stablecoin, centered not on 1.00 but on the token's accruing fair value, with the range recentering as yield accrues. A standard stable-pair strategy pegged at parity will be systematically arbitraged, because the token's fair value drifts upward every day while the position keeps quoting yesterday's price. The launch problem is therefore a NAV-tracking problem from day one, which is how Amplifi structures these deployments.
Center on accruing fair value, not on 1.00
The token's fair value is 1.00 plus accrued yield since issuance. Ranges have to track that number, not the label. Anything else is a slow-motion transfer from LPs to arbitrageurs, priced in the daily yield rate.
Recenter on the yield accrual cadence
Recenter the range every time NAV updates on-chain, or on a fixed interval calibrated to the accrual rate. The interval is a bandwidth question: too tight and you spend gas on noise; too loose and the position bleeds each interval. Model the two costs against expected volume.
Use dynamic fees where the venue supports them
Uniswap v4 hooks and dynamic-fee LBPs let the fee widen during rebalance windows and around known volatility events, compensating LPs for the moments when they are most exposed to informed flow. On v3-only venues, the same problem is handled through range width and inventory limits.
Backstop with mint/redeem
The issuer's mint/redeem facility is the ultimate arb path. Publish where it sits relative to the pool and size pool depth so that the mint/redeem spread caps the range's downside. When the two are aligned, aggregators route through the pool and only fall back to mint/redeem for size the pool cannot handle.
To scope a yield-bearing stablecoin launch, contact contact@amplifiliquidity.com.