Introducing Liquidity Bounties
Community-based market making programs
Blog » Top liquidity miner interview featuring Lorenzo Boyice
It has been just over two months since we launched Liquidity Mining. With heated competition, miners have been working very hard to rank higher on our leaderboard! And we saw more miners join this game and invest larger quantities of assets.
In this post, we introduce you to Lorenzo Boyice, fairly new to our community but already ranked into Weekly Top 10 for the past few weeks consecutively. In 2010, he once paid 21 Bitcoin ransom to hackers who locked down his computer files. Now he is a software engineer by trade and started investing in crypto in late 2018/early 2019. With liquidity mining, his current monthly return is around 3-5%.
Disclaimer: Not financial advice. All views expressed in this interview are the interviewee’s and do not represent the opinions of hummingbot.io. Hummingbot does not guarantee nor claim to guarantee profits.
I received my bachelor’s degree of computer science from the University of Missouri, Columbia where I developed a pretty solid foundation. After I graduated, I started to work in the (tech) industry in Kansas City at a company called Garmin. It was really interesting because when I first started working there, I was working in their aviation department. I had no idea that Garmin developed software for pilots in planes. I got some industry experience, after a while, I came across a great job opportunity at Google. So I have been a software developer at Google for about 3 years now.
It was Hummingbot first. I was already a big fan of crypto and really behind the ideology. Basically I started investing and (I’m) just sitting on this collection of crypto assets. Besides HODLing, I just wanted to find a way to maximize my profit. How can I make my money work for me? I started to dig into staking, arbitrage, automated trading, and bots. After a while, when I was just doing some internet searches, I think I came across Hummingbot. Originally, I was looking for arbitrage opportunities. As I read through the documentation, I came across this liquidity mining idea. I think that really got me involved with you.
As far as a timeline, I didn’t actually hear about this until a month ago. Hummingbot is a really new thing to me. I kind of fell in love with the product right away. I remember comparing your software with bots and others in the industry, and realizing you're ahead of the game!
I’ll tell you a quick little story. It was quite interesting. This was 2011, I was in high school. I got this virus on my computer. All my files were locked down. At the time I produced music and this brought everything to a halt. Basically this was a scam, extortion type of scenario. In order to unlock my music, they asked me to pay 21 Bitcoin (that's worth about USD188K today). I was like… what the f@!$ is a Bitcoin. I started to research it in 2011 but just couldn’t understand it so I paid the ransom and they gave me my files back. I didn’t really think about it after that.
But then as I grew older, my interest in the technology grew, and I revisited this idea again in early 2018. The topic came up and some told me “...but don’t start mining Bitcoin”. What did I do? A year later I ended up buying a few ASICs. Very stubborn. But after that conversation I started to dig into Bitcoin and cryptocurrency, and read a lot of articles. I wanted to be a part of the ecosystem end to end. My first introduction was getting into ASIC mining. I mined BTC, Bytom, Dash and a few other altcoins. And that’s when I really started to understand how exchanges work and I began trying to trade crypto on a few of them.
It’s been great. Compared to the other services I’m using, it’s a great marriage of modularity and decentralization that I’m looking for. I kind of wanted something that’s a little bit more granular, software with an out of the box strategy that can be refined. And another thing that really appeals to me is it’s free and open source. You really can’t beat that.
I would say that was under an hour. If you have the technical background and experience developing and deploying applications, you can get set up quick. But if you don’t, I think the guides and the videos are super helpful. The more advanced configuration videos are more helpful for me. I’m still trying to learn more about it. One thing I'm excited about is the training you provide. So I signed up for training in May. I know the technical aspect of the project but I’m not really well versed with the financial/trading aspect of it. I’m trying to build my skills there so that I can make my bot a little bit more efficient.
Positive. Go eagle club! (haha) But the whole idea is what puts you ahead of the game. I kind of like this passive income idea. You know? This opportunity was really attractive to me once I read through your whitepaper on it. The thing that really drew me to the project is the fact that it's decentralized and really focused on empowering individuals and building a community of investors who get to support tokens and projects they like. Its idea is fairly new in the industry.
I didn’t have a lot of altcoins. I had Bitcoin, Ethereum and a few Binance coins. I would say this program definitely introduced me to a lot of coins that I didn’t know they existed. A great opportunity to explore and invest in those projects.
Long story short, yes. Determining direct profitability, it’s a bit difficult. So I’m using Binance as my exchange where I also do manual trades. I’m not an experienced trader, so I know some of the manual trades I've made were not profitable. I think most of my profits come from liquidity mining. I’m now on track for a 40-50% annual return. I think for the first month I’ve been trading, I made about 3-5% return.
I started with pure market making. I think that’s the ideal setup I’m kind of looking for.
Yeah, I played around with the settings. I started with a single order. As I understood what market making was, I started to see some advantages of doing the multiple orders. I read through your documentations, then I upgraded to using multiple orders. I normally use 3. I think that’s my magic number.
My first instance just to try it out was set up on an old computer. I first downloaded it on there and had it running for about a week, and got the payout. I thought this seems legit. I then saw you had some documents on how to set up cloud instances. I started using Google Cloud and created a virtual machine there. That has been wonderful. I have been running a couple of bots.
For the longest, I was running 8 bots for all the markets. I was just curious to see which one has the best return, performance, things like that. Now I narrowed it down to 2-3 for the tokens that I want to be involved with.
I think it’s good for someone who doesn’t know a whole lot just like me to get started. So I think your strategies are good, we have nothing to worry about there. But you have things like inventory skew, dust jumping, or tips on setting spreads, if you can bring these out to the front a little bit more, and educate traders a little bit more, I think that can really empower users. That’s why I signed up for the advanced training.
Most certainly, especially during my first few weeks. I didn’t really know what I was doing at first so I would tweak things, wait a couple days and tweak things again. But as of lately I've been on about a weekly cadence. At the start of the week I like to sit down, analyze the markets, adjust my positions accordingly then come back next week to review.
I’m currently trading ZIL/BNB, ZIL/USDT and RLC/ETH. I did some research on the tokens, and formed my opinion as far as the overall projects that I can really get behind and believe the things really have a future from a year from now. Also at the same time, I looked at the rewards I’d get from providing market liquidity to these tokens. I think combining these two aspects is how I was able to narrow down to these pairs.
Sometimes I use CoinGecko, CoinMarketcap but mostly TradingView. I look for basic signals in the EMA, MACD and volume.
I would say, definitely have multiple sources or multiple signals that you use to trade or to make your decisions especially with volatile markets. I think it’s about finding the combination of different things you should be looking at. Based on these signals, you can set your positions more accurately and more defined with Hummingbot. For example, if you see it’s going to be a really strong bull market, you can set your spreads to account for it so that you don’t exit the position too early.
I don’t if it can apply to everyone, but for one, something that has been holding true is investing in my gut decision. One thing I learned is just make a decision, stick by it, and adjust afterwards.
For exchanges and projects who would like to learn more about liquidity mining, please contact us at firstname.lastname@example.org.
Who we are and why we are building Hummingbot.Learn more