LeoStrategy is launching its LSTR and SURGE tokens on the Base blockchain to attract new investors and create a system for continuously growing its holdings of the LEO token.
This strategy, called "volatility harvesting," works by profiting from small price differences between various trading pairs. The profits from these activities are used to buy more LEO tokens, which are then added to LeoStrategy's balance sheet.
This market-making plan will happen in three stages:
The first step focuses on finding easy arbitrage opportunities for LEO, LSTR, and SURGE on the Hive-Engine.
LeoStrategy will have an advantage here with lower bridging fees, giving them a competitive edge when trading different versions of the LEO token across blockchains. The profits will be used to buy and permanently hold LEO.
After launching on Base, LeoStrategy will profit from the price differences between LSTR and SURGE tokens on both the Base and Hive blockchains.
The LSTR and SURGE pools on the Base blockchain are designed to do two main things:
Using USDC trading pairs, investors can buy LSTR and SURGE with low friction and easy pricing.
WETH (a form of Ethereum) pairs are used to create price swings that LeoStrategy can profit from, leading to more LEO buybacks.
LeoStrategy has ambitious growth goals based on its projections:
Small daily volume ($100k): Even with modest trading, this could lead to buying back about 4.5% of the total LEO supply every year.
Large daily volume ($1M): With higher trading, the company could potentially buy back a massive 45% of the total LEO supply annually, creating a constant demand that would push up the price of LEO.
By launching this strategy, LeoStrategy aims to significantly grow its own assets and create ongoing, high demand for the LEO token. The move to the Base blockchain is key to this plan, allowing the company to access new investors and strengthen its position in the LEO Token Economy.
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