Arkadiko Launch Information

Hello Arkadians,

It’s time… Arkadiko is launching at Stacks block 34620, roughly around 4 PM Central European Time.

The wait is finally over and soon you will all be able to participate in our glorious adventure. Vaults and Swap will be enabled right from the start, but actual emissions will start later.

This blog post will go over the most important details of the launch.

In order to maximally prepare yourselves, make sure you have the Hiro Web Wallet installed and loaded with some STX tokens. STX is your main entry into Arkadiko as you need it to pay for transactions, open vaults and swap to other tokens.

While we are very excited and confident about our product, we need to write some words of caution. Arkadiko is still in an experimental phase and has never been battle-tested in the wild climate of a mainnet. This is why we advise everyone to be careful and not invest more than you are willing to lose. Bugs and potentially exploits are possible at this stage and we would like to minimize the damage in case something like this happens. We’ve done extensive testing and were audited by 0F, the leading authority on Clarity-audits. But one can not be too careful in the early stages so please take it slow and do not risk any capital that is of critical importance to you.

With that being said, let us take a look at how the launch will develop.

At Stacks block 34620 (4PM CET) we will open up the front-end to the world. At that point, functionality like opening Vaults, minting USDA and providing liquidity to Arkadiko Swap will be fully operational.

A few hours after front-end release, we will enable everyone to swap tokens on Arkadiko Swap. This will be the first chance for many to get DIKO tokens. You can use both STX or USDA to purchase them from the pool. Afterwards you can provide liquidity in the DIKO pairs or stake your DIKO in the Security Module for a longterm approach. Make sure you are familiar with the risks of the Security Module and Impermanent Loss that can occur on Arkadiko Swap.

In the early days of the protocol, some issues can come up that will flatten out over time.

First of all, there will be a very high number of transactions created in the first few days, potentially leading to some congestion on the Stacks blockchain. Transactions in this case could take up to several hours. We advise you to pay 5x fees for a higher chance to get your transaction through as fast as possible. Still, the speed at which the average transaction will confirm might be rather slow. This is a technical problem of Stacks itself and they are working on a solution which should be implemented in the coming weeks or months. Bear with us for now and know that your fellow Arkadians are likely facing similar delays.

Because the potential for congestion is a real concern, we have decided to start emissions a few days after opening up the front-end. This has been done so that everyone will have plenty of time to position themselves.

Emissions will start at block height: 35300, approximately at 4.5 days after launch.

If you are one of the very first to participate in the protocol, the liquidity might still be on the lower end. This could lead to higher slippage than intended. Provide liquidity as soon as possible to support the protocol.

Regarding the USDA price/peg and DIKO price, there are basically no guarantees here. We expect both tokens to fluctuate wildly in price as the demand is unpredictable. Especially USDA might be priced higher or lower than its intended 1 USD peg. Please pay attention to this to avoid swapping to USDA when it is significantly over-priced. Rather, mint more USDA in this case and swap it back to STX to buy cheap STX off the market.

Remember that enabling the PoX-stacking feature will lock up your STX for 3 cycles, so if you need extra flexibility in the first few weeks, leave them unstacked.

We think it is best to be conservative with the lending ratio at the start. That is why we allow you to only mint a maximum of 25% of your collateralized Vault position. The risk of liquidation is very low but it means you lose some capital efficiency. We plan to increase LTV once everything is confirmed to run smoothly

Now onto some strategies:

There are different strategies with different risk profiles available. You can go into the DIKO pools by purchasing DIKO first and then providing liquidity in either DIKO/USDA or DIKO/STX.

This strategy is higher risk since the DIKO price might fluctuate a lot, leading to losses on the token if purchased at a too high price point.

A more balanced strategy which will not change your portfolio exposure that much is providing liquidity to STX/USDA by minting USDA in Vaults. If you have 1000 dollars worth of STX available, you can use 800$ worth to mint 200 USDA and then pair that with the remaining 200 dollars worth of STX for a 400 dollar liquidity position in STX/USDA.

There are other options such as using your minted USDA to purchase DIKO or STX. If you get more STX this way, you can add that to a Vault again to create a tiny leveraged position. This will become a more efficient strategy once we raise max LTV after a few weeks.

We want all of you to join the community discussion on telegram and mainly discord. Report bugs, help other users with questions and propose new features to implement.

Arkadiko Protocol is a stablecoin (USDA) built on Stacks to bring DeFi to Bitcoin.