15. How to Open New Pools | DLMM KING

DLMM Clan is an independent DeFi liquidity-provider education community for EVM chains, distinct from Meteora, which is a DLMM protocol on Solana. In this walkthrough, CryptoCroco shows how to open a new pool on DLMM KING (https://dlmmking.com/) when the pair you want is missing. BUN already had USDG pools at 0.07% and 0.8%. He wants BUN against ETH on Robinhood Chain. From the Gold Map he reads a 1% ETH-side fee and plans to undercut it so aggregators and bridges route arb even with little TVL. After a GMGN and DEX Screener check he pastes the token address, sets wrapped ETH, picks a claim pool for a volatile token, takes a 0.4% fee setting, Suggest Price, connects Rabby, and creates. Empty bins get about $30 of Spot base liquidity with Autofill, then he draws a DCA from current price down the trend line.

Intro: how to open pools on DLMM KING

How do you open pools on DLMM KING? DLMM KING is a DEX live on Robinhood Chain as well as Base. What you see here on the right side of me is the pool page. So normally, when you land on the website, you land on the leaderboard where you see all kinds of other positions that you can copy. Now I'm up here, I'm on the pools page, and you can search up here. You can filter for Base and Robinhood, and right now I want to open a pool for, I don't know, BUN. BUN is already something open, so I can look at this, see what kind of positions are there open, 0.07 and 0.8% pool is already open here.

Now, both of these are against USDG. Now, let's assume I want to open a position against ETH, and I only see positions open against USDG. Now, how would I do this? In this video, I will go step by step on how I set up the pool, how I decide the fee settings for the pool, and then walk you through the entire process.

Let's get into it.

The material presented in this tutorial and accompanying presentation is intended for informational purposes only and should not be interpreted as financial advice. Any investment decisions or positions you take are solely at your own risk.

Gold Map and why you undercut the 1% fee

So generally, I normally start always at the gold map, and the reason for this is that on the gold map, I can see a little bit which tokens are going very well right now. And you can see here these different tokens, and I get a direct idea. So I see Boner here, I see Astro, and here I also see BUN. So if I look at this, I could open a position for either of these. And the first thing I do here is I look at the fee settings. So if I look here, I see, okay, general fee setting against Ethereum of 1%. Now, if I look at this position, I see the same and I can see, oh, there's also a fee setting against 1%. Now, we said we want to open this against ETH, so I already have my fee setting. I need to be below 1%. That way, I can get arbitrage volume and can always make sure that we capture volume from aggregators and all kinds of bridges, because DLMM KING is connected to all of them. So this way, I will earn more fees and the price in my pool will always be near to the real price. So it doesn't matter how much liquidity is in there. As soon as the fee setting is right, I will get arbitrage volume.

GMGN, DEX Screener, and pairing vs ETH

Okay, so we said we want BUN, and I opened this one already here. I looked at BUN. The first thing I always do is I just quickly check on GMGN.ai if there is any red flags. This one is a... I mean, you see it all over Twitter. This one, there is no honeypot and anything there. Now, I normally also look at DEX Screener, and the main reason I do this because I want to look at the different pools. So you can see here, the big pools are all against ETH, and then there the smaller pool is against USDG. So I look at all of this and I say, "Okay, I want to do against ETH." So I look at one, I want to open a pool against ETH. And I can see the volume is pretty solid for the liquidity there over 24 hours. And if I look here against ETH, I also get directly the price, right? So I get a good understanding of what the price is against it. Maybe just for you, in times where I think tokens are generally, cryptos generally in an uptrend, even if it's just in a time period, I always tend to rather pair my token against Ethereum instead of USDG because I want to be in the market and I only want to DLMM tokens that outperform my blue chip base tokens, which are Bitcoin or Ethereum or large chain tokens. So in this case, now I have it here against ETH, and let's say my thesis just really quickly, I say, "Okay, maybe it will stay on this trend line and will trace down. I want to open a position here and capture that." So here I can see already the ETH price, so it gives me a little bit of a guardrail when I open the pool where the price should be, because it will fetch it automatically. But I keep in my mind here, okay, this is a couple of zeros too, because in Ethereum, it's obviously always a very small number, so be careful here. That being done, this looks good. Now I go back. I know the fee settings, I know the pool, so I copy it here again. This is the token I want. I want it against Ethereum, and I want to open a 1% pool, lower than 1%, because the large volume running one has a 1% and I want to undercut that. Now I have all the information I need.

Create Pool: chain, token, quote, claim vs auto, bin step

Now I'm going to open the pool. So what you do to open a pool is you go on Pools, and then up here on the right side, you see a button called Create Pool. And let's go just step by step. So first one is the chain. You can choose if it should be on Base or if it should be on Robinhood. In this case, the token lives on Robinhood Chain, so I choose that.

Next, I need to choose the token, and here always the best is to take the token address. It's the one I just copied from DEX Screener. I paste it in here and I see the BUN token. Now, the next field is the quote token, and with the quote token, you always need to check which one you want, and you need to be very careful then depending on it that the right price is down here. ... later on. So I want wrapped ETH, so I need to have down here at the end a price that is against wrapped ETH, not against USDG. Now, the next one is pool type, auto pool versus claiming pools. And in the docs of DLMM Clan, there's a very nice animation explaining the difference. But just in a nutshell, if you have an auto pool, the fees auto-compound in the bins you've set, and they are locked in there, and they are subject to trading. If you have claim pools, then the fees are claimable. They are being taken out of the position, so they never enter the position, and you can claim them anytime. This is, in a nutshell, the two different pools. I prefer, especially for volatile tokens, to take a claim pool because that allows me to sell off my fees that I'm earning against Ethereum, and then the fees that I earn are not subject to any kind of token volatility anymore. So, this is a loss when the token goes a lot to the upside, but it's a big win if the token goes to the downside, then I really have the fees in Ethereum and kind of, yeah, have a safe base on that side. So I'm going to choose claim, and now it's the right bin step. So, see, you always have two things. You have the bin step and the base fee. And again, here there's a very nice animation explaining this on the DLMM KING docs webpage. But in a nutshell, it simply just tells you what's the fee setting, and the BPS is how much is one bin to the next, the price jump. And we've seen before they had a 1% pool, so I could take this, but then the price jump of one-to-one, I only get the fees within a bin. Something that would be even more aggressive would be the 50 BPS. A bit back and forth. I think in this case, I'm going to try even the 50 BPS. It would be one of these two, because just in my head, 100 BPS is 1%, and then 0.8, that means if the price jumps from one bin to the next, you actually need to have a price difference of 1.8%. This is kind of in my head. So if I'm with 0.4 and 5%, I'm on any scenario undercutting what is out there. So, I'm going to take this one, 0.4, and then I click here for suggest price. And now you can see, I can see here the zeros. I can check that back, 082. And I remember here, this is in line with what we have here. It's the same. I have it up here in Ethereum. This looks good. So, what I'm going to do now is I'm going to accept this. I'm going to connect my wallet. I haven't done that yet. Take the Rabby wallet. Here we go.

This looks good. Create pool.

Awesome.

Seed base liquidity, Autofill, and DCA on top

The pool is created. It directly appears here on the right side, and I can start DLMMing it. And I will do now the same as last time, as I already showed. I'm going to use here the tools. I'm going to draw here my trend line in, and then open a nice DCA position from the current price down to this, because I want to DCA in, and this is how I'm going to play this one. This, and then I can play it accordingly.

So one more important that you need to know is right now there's no liquidity in the bins, and this is a problem. So you do want to add a base liquidity there to trade this, so just that the pool stays correctly in range. So I tend to normally set something like a spot, something like this, and provide base liquidity. So this would be 100. I'm going to take maybe 30 dollars. So how much is this? At 27, so this looks good to me. And then I'm going to activate here autofill. So what does this do? This makes sure that I will have exactly the right bins on both sides. So, even if I only have Ethereum in my wallet, I now, the portion that I have up here is going to be traded over into BUN token. So I'm going to do this quickly.

There we go. I have my position, and just do it a bit further as base liquidity, and I confirm my deposit.

There we go.

So, the pool is live and has the fee setting that we chose to undercut what is currently on the market and get good arbitrage volume as well as volume from aggregators and bridges. And then the last thing that is very important is base liquidity. So the price will adjust as the price moves and is not stuck at this price point. So therefore, it's always important to add some base liquidity in the beginning.

Join the DLMM Clan

And if you are still there, you are truly part of the chosen 5%. You understand what it takes to make it in the most brutal market out there, which is the crypto market.

I salute to you in respect, and I invite you to join me in my community, the DLMM Clan. There are so many resources, tutorials, opportunity trackers, tools. People you can ask questions to, and weekly meetups where you can find like-minded people like you and I.

Buying the bear market dip just feels so much better doing it together. I am speaking out of my own experience, especially in the bear market where you're unsure, knowing others are around you is really helpful.

The clan is 100% free and open to anyone who's joining right now.

In the future, though, once the bear market bottom is in, we will start restricting access.

But for you who's joining right now, it will always remain free. So, looking forward to see you there.

Why the right fees beat pool size

With that said, now I'm going to build my position on top of that base liquidity. I hope you found this helpful, how to open pools, how to identify pools, how to set the right fee settings. And then ultimately, when you know how to do this, you can LP any kind of pool that is on Robinhood or on Base, and you do not need to worry about liquidity within the pool because the arbitrage is so strong. And if you have the fee settings right, you are not missing out any gains. In the contrary, you can even often outperform the large pools on Uniswap because DLMM is just so much more efficient in capturing fees. Hope you found this insightful and see you next time. CryptoCroco. Bye.