Why the Ramses Flywheel Should Be Getting Exponentially More Torque

Almost any electric car can out-accelerate an ICE (internal combustion engine) vehicle. As an EV driver, I love this. The increased torque is handy when making left turns, merging on the highway, and passing the asshole braking while driving up the grade. But, of course, I'm no engineer, so I can't explain exactly why this works: it may be no gear shifts, more wheel power, better efficiency, or many other reasons.

I know that electric cars move faster. Similarly, decentralized exchanges with concentrated liquidity (CL) experience a massive increase in use and efficiency compared to the traditional v2 model. Simply put, concentrated liquidity allows the liquidity pool provider to put their liquidity to use more effectively. In return, the CL pool provider earns more rewards. And the platform earns more fees.

Unfortunately, implementing concentrated liquidity is more intensive than traditional pooling. On the liquidity provider side, it is also far more complicated than simply adding 50% of token A and 50% of token B. However, several big liquidity providers have created strategies to maximize their profits.

When Ramses Exchange launched concentrated liquidity last week, I didn't pay much attention to it. Today that changed. And seeing how impactful CL can be, I am increasing my confidence that Ramses is the best Solidly Fork in DeFi. If you aren't familiar with Ramses or the Solidly ve3,3 model, I will encourage you to read: $13 Million in Annualized Rewards on a Platform Valued at $2.2 Million- Part 1

In this piece, I will explain why Ramses ($RAM) is undervalued and why concentrated liquidity can move the floor on the RAM token much higher. I'll also share my strategy, which hasn't changed and works well even as the RAM price has struggled.

How Big of a Deal Could CL Be for Ramses Exchange?

It's always best to be one step ahead of the crypto market. In small projects, owning a token a few days in advance can make a huge difference if the token experiences tremendous buying pressure. At the time of writing, the RAM market cap is around $1.2 million. This puts it firmly in the small-cap market.

While concentrated liquidity is live on Ramses today, it is not being rewarded with RAM emissions…yet. This means CL providers aren't rewarded with fat APRs paid out in RAM tokens. However, this should change in the next epoch (less than one week from today). Of the $25 million in total value locked (TVL), only $500,000 is added as concentrated liquidity.

I expect the amount of TVL in concentrated liquidity to spike during the next epoch when RAM rewards are paid out to CL providers.

However, look at the activity such a small amount of liquidity has drawn. Today, there was over $1 million in trading volume on the $500K in CL. This translates to $855 in fees generated.

$855 doesn't seem like a lot, but if most of Ramses' $25 million in TVL gets converted to CL, this could mean increases in trade volume and transaction fees. 75% of the CL transaction fees go to veRAM stakers. This can equate to a huge bump in weekly fees.

It should be noted that this one day may be an anomaly. Nonetheless, if Ramses didn't have CL in place, it wouldn't have earned this trade volume today. Also, total crypto trading volume has been declining throughout the bear market.

How Concentrated Liquidity Can Impact the RAM Price and veRAM Earnings

The ideal way to approach the Solidly Fork (ve3,3) model is as an income producer. The idea behind the model is to reward long-term holders with bribes and transaction fees.

But let's look at how the CL addition can accelerate the income veRAM spits out to its holders. Imagine if CL adds $30K in fees every epoch above what the V2 liquidity model provided. This would equate to over $1.5 million worth of annual income distributed to veRAM stakers.

However, the story gets even better. As CL providers start earning higher rewards, it may cause more partners to increase their weekly bribes. This is where the flywheel goes into effect. More bribes->more veRAM investment->higher RAM price->more valuable emissions to CL providers — >attracting more CL liquidity -> causing more bribes by platforms.

How I'm Playing the Addition of Concentrated Liquidity

One aspect that makes me value Ramses over other Solidly Fork (ve3,3) is its layer two solution, The Ennead. The Ennead does all the heavy lifting; frankly, I have no interest in doing things like weekly voting or tracking bribes. The Ennead votes and streams rewards and neadRAM has liquidity if I need to swap into something else.

I also really appreciate how neadRAM rewards its stakers. I get two tokens for rewards, neadRAM and wETH. I can pocket the wETH as income and compound the neadRAM to increase my income further.

At the time of writing, neadRAM is trading for about 3.3 cents. So staking currently rewards 108% in NeadRAM APR and 71% in ETH APR. And it's completely passive. So I only have to go in and collect my rewards!

Key Takeaways

Ramses Exchange earns real income that gets distributed to veRAM and neadRAM stakers. This real income should increase with the addition of concentrated liquidity. This is a fantastic time to invest in a project before the increased platform earnings take full effect. It involves added risk if CL doesn't make the impact I expect, but the RAM token has already been beaten down badly.

When considering you are investing in a project innovating the space, offering real income, and being led by a team of professionals, great results can occur. For these reasons, I am adding to my neadRAM allocation and staking on the Ennead in advance of concentrated liquidity going into full effect.

Ramses Exchange Telegram: https://t.me/ExchangeRamses
Ramses Exchange Discord: https://discord.com/invite/ramses

I have not been paid or sponsored to write this article. I am investing in $RAM, neadRAM, and providing liquidity via The Ennead. This information should not be taken as investment advice. Digital assets like crypto and NFTs involve risk, so you should always perform due diligence before investing.

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