Liquidity Pool (1%)

What is a liquidity Pool?

A liquidity pool is a collection of funds locked in a smart contract making a token tradable on decentralized exchanges.
A liquidity pool consists of two different tokens both representing a certain value which combined are known as 'the liquidity'. Most of the time a liquidity pool is created with 50% of a certain token on one side and 50% of the other token on the other side.
When liquidity is provided to a liquidity pool, people receive liquidity pool tokens which serve as their evidence in the blockchain proving that they provided this liquidity.

How is liquidity provided for HFT?

As in all the things we do, we like to do it a bit differently, and by doing so we also made liquidity providing for HFT easier and more safe. Because next to the automated reflection that our hodlers get, we also automated the process of adding liquidity to the liquidity pool without having to rely on third parties.
At the start of the Hodl Finance ecosystem, a Token Generation Event (TGE) occurred. 10% of the maximum supply of HFT was entered into the liquidity pool together with a certain BNB amount which was equal to $150,000. The price of HFT was set at $0.00000714 and we started with a liquidity pool of $300,000 in total.
Now, with every person making a smart contract interaction, a portion is automatically divided into 50% HFT and 50% BNB to be entered into the liquidity pool. After the smart contract provides the liquidity it receives liquidity pool tokens which will be sent to the burn address. This means that all liquidity going in the liquidity pool through the Hodl Finance smart contract is locked forever!

What did we notice?

When looking at other projects which also provide automatic liquidity through the smart contract, we noticed something.
The more liquidity was added to a liquidity pool, the more stable the price became. We anticipated on that by implementing a threshold of 2200 BNB for the HFT liquidity pool as we determined this to be the perfect balance between enough liquidity and tradable volatility.
Once the threshold of 2200 BNB is met, the part of the network fee which goes to the liquidity pool will flow to the marketing treasury. Since the crypto domain is rapidly evolving and marketing is a big part of keeping your project in the headlines, we opted for this.