Summary
This proposal recommends migrating Neverland’s incentivised USDC/DUST liquidity from the existing Uniswap V2 pool to a newly deployed Balancer V3 AutoRange pool on Monad. Today, the Uniswap V2 pool creates headline liquidity, but much of that capital is not useful at the prices where DUST actually trades. The AutoRange pool is a fungible concentrated liquidity AMM that automatically recenters its price range over time without any user action, giving Neverland the capital efficiency of concentrated liquidity without the operational and game-theoretic problems that have undermined previous concentrated liquidity attempts.
The expected outcome is meaningfully deeper effective liquidity at the trading price, materially lower slippage on routine trades, more productive LP incentives and fees per dollar spent, and a more resilient DUST price chart through the recurring epoch sell pressure cycle.
The migration will be done as a hard cutover and nUSDC LP incentives which are currently distributed via Merkl on V2 LP positions will be redirected to holders of the AutoRange pool’s BPT. Neverland’s existing protocol-owned liquidity, currently held in a Uniswap V3 position, will be withdrawn and redeployed as a passive Uniswap V2 backstop position alongside the new AutoRange venue. The proposed initial parameters, suggested by the Balancer team, are a price ratio of 4.0, a centeredness margin of 5%, and a price shift exponent of 2%.
Problem Statement
Neverland currently incentivises liquidity in a Uniswap V2 USDC/DUST pool that holds approximately $835k worth of DUST and USDC. V2 spreads this capital uniformly along the entire constant-product price curve, which means that the overwhelming majority of it sits at prices far from where DUST actually trades. The effective depth at the spot price is a small fraction of the headline TVL, which means Neverland is currently incentivising a large amount of liquidity that is not meaningfully active where DUST actually trades. Traders therefore experience much worse slippage than $835k of liquidity should imply. The migration fixes this by making the same incentive budget support liquidity that is actually useful at the trading price, instead of spread passively across the entire V2 curve.
This is a particular problem given Neverland’s flow profile. Locked DUST positions mature on a 7-day epoch cadence, and a meaningful concentration of sell pressure occurs in the roughly ±1 day window around each epoch end. On a V2 pool that prices this flow inefficiently, the recurring imbalance translates directly into a recurring price dump on the chart. Each epoch produces a visible downward move that is larger than the underlying selling actually warrants, simply because the available depth at the trading price is relatively thin. This is bad for DUST holders, bad for sentiment, and creates an attractive setup for predatory positioning ahead of each epoch end.
Previous attempts to fix this with concentrated liquidity have failed for a different reason. Some LPers converged on ultra-narrow ranges to maximise fee and incentive capture, and were then forced to rebalance constantly as the price moved, producing rebalancing cascades that fragmented liquidity and pushed most passive LPers out of range. The incentive program ended up subsidising a small group of active managers who could withstand this churn, rather than building the durable, broadly-held depth that Neverland actually needs. The structure punished exactly the kind of LP the protocol most wants to attract: passive, durable liquidity providers who want exposure to USDC/DUST without competing in a range-management game against active LPs.
The Balancer AutoRange pool resolves both sides of this problem. It delivers the capital efficiency of concentrated liquidity, which improves the price chart by absorbing epoch sell pressure with much less price impact, while encoding the range management as a deterministic on-chain mechanism with parameters fixed at deployment. All LPs share a single range and hold a single fungible BPT, and the pool itself handles range adjustment automatically. There is no manual range to set, no manual rebalancing, and no game to win against other LPs. Volatility no longer forces individual LP action.
Low Level Details
Capital Efficiency and Impact on DUST Price Stability
The most important consequence of this migration is on the DUST price itself. With the same amount of liquidity concentrated into a ±4x range around the trading price rather than spread along the entire price curve, the effective depth that any given trade actually sees is multiples larger than it is today. Concretely, this means three things:
First, routine swaps move the price less. The same $10k buy or sell that produces a visible candle on the V2 chart today will produce a much smaller move on the AutoRange pool. The DUST price chart should become quieter and more orderly through normal trading activity.
Second, the recurring epoch sell pressure becomes substantially more absorbable. The ±1 day surge of post-epoch selling currently functions as a predictable downward catalyst because the pool’s response to that flow is steep. In a concentrated environment, that same flow lands into far more depth at the trading price and produces a correspondingly smaller move. Over time, this should compress the magnitude of the recurring epoch dip, make the post-epoch reversion cleaner, and reduce the incentive for actors to position predatorily ahead of each epoch end.
Third, the asymmetry of the benefit is favourable. Because Neverland’s flow is biased toward predictable downside pressure, the dampening effect of concentrated liquidity is focused on exactly the moves we most want to dampen. Consequently, buy pressure also moves the price less, which is a real cost in directional rallies, but the trade against a more stable baseline price chart and a more resilient response to known sell catalysts is the right one for Neverland’s current stage, while we build out more revenue streams and meaningful utility to drive organic demand for the DUST token.
LP Economics and Fee Flexibility
The migration also improves the fee and incentive surface for LPs. The current V2 pool is locked into a flat fee model, regardless of DUST’s volatility, flow profile, or liquidity needs. A Balancer AutoRange pool gives Neverland more flexibility to align LP compensation with the actual market structure of DUST.
Fees, depth, and incentives become better aligned. LP capital sits closer to the trading price, routed flow interacts with more useful liquidity and the incentive program rewards positions that actually improve execution instead of rewarding idle liquidity across unused parts of the curve.
AutoRange Pool Architecture
A Balancer AutoRange pool concentrates liquidity inside a defined price range and uses the same in-range swap math as a UniV3 position. The novelty is that the pool maintains its own range and shifts it over time in response to where the market is actually trading. When the pool is near the middle of its range, it behaves as a static concentrated position. When trading flow pushes the pool’s balances meaningfully out of balance, the pool begins migrating its range over time to follow the market. LPs hold a single fungible BPT and do not manage individual positions. Adds and removes are proportional. No external operator, ALM, or rebalancing actor is involved.
Initial Pool Parameters
The Balancer team has suggested an initial price ratio of 4.0, a centeredness margin of 5%, and a daily price shift exponent of 2%. These settings prioritise pool stability over rapid range adaptation, which is the appropriate posture for a pool that must absorb a recurring, mean-reverting flow cycle every 7 days.
The ±4x range gives the pool meaningful headroom to absorb normal price movement without needing to chase it. The low centeredness margin means the pool sits still through ordinary epoch wobble rather than reflexively moving its quoted range every time a few large trades come through; the epoch-end imbalance is mean-reverting in character (subsequent buy interest, two-way flow across the following days), so allowing the pool to absorb it within the existing range is preferable to shifting the range itself in response to flow that does not represent a sustained directional move. The conservative shift exponent ensures that when the pool does need to track a sustained directional move, it does so gently rather than in jumps.
The centeredness margin and the price shift exponent are admin-mutable post-deployment and can be tuned in the future as we observe real behaviour. The price range bounds are fixed at deployment.
Post-Migration Liquidity Structure
The Balancer AutoRange pool becomes the core incentivised liquidity venue. Aggregator routing should naturally prefer it on size because of the concentrated depth advantage.
The Uniswap V2 pool remains live as a passive backstop. Neverland’s existing protocol-owned liquidity, currently held in a Uniswap V3 position, will be withdrawn and redeployed into this V2 backstop. The V2 pool is not incentivised after migration. It exists as a non-Balancer fallback that ensures DUST remains routable through V2-only paths and provides redundancy in the unlikely event of an issue with the AutoRange venue.
Incentive Program Migration
The nUSDC incentive program continues with the same budget and the same Merkl distribution infrastructure. The key change is the target: rewards accrue to holders of the AutoRange pool’s BPT rather than to LPs of the V2 pool. The V2 Merkl campaign will be ended in the same coordinated action that begins the new AutoRange campaign. We do not propose dual incentivisation, because splitting an already modest TVL across two simultaneously incentivised venues would dilute the signal to LPers about where Neverland wants liquidity to sit.
The exact incentive budget is out of scope for this proposal and will be adjusted at the discretion of the team once the pool is live and baseline TVL response can be observed.
Security Assessment
The AutoRange pool has been the subject of two independent security reviews for which formal reports are available and linked in the references. Balancer has additionally communicated that the pool has been subjected to further AI-driven security analysis through FailSafe, Octane, and another provider, although formal reports from these additional reviews were not made available for this RFC.
The audited commit contained no critical, high, or medium severity findings across the two reviews for which reports are available. All low-severity findings identified by Cantina were fixed by Balancer. The remaining residual risks are real but specific, and the proposed parameter choices and operational posture (in particular the conservative price shift exponent, and the intention to make minimal use of admin-side price ratio updates) address them directly.
Residual Risk Considerations
The AutoRange pool is a relatively new pool type. Although well audited and in production use across Balancer V3 deployments, it has less production track record than V2-style or static concentrated designs. The conservative parameter selection and the V2 backstop are the mitigations for this.
A sustained directional price move in DUST would draw the pool out of range and trigger gradual repricing. At a 2% shift exponent, the pool’s catch-up is intentionally slow, which is good for stability but means that during a strong sustained trend the pool may continue quoting prices that lag the market-clearing level for an extended period. The relevant mitigations are the built-in gradual shift mechanism, the parallel V2 backstop pool which will exhibit different price dynamics under the same flow and create some arbitrage rebalancing, the ability of organic buy-side flow to enter at depressed prices, and the ability to tune the shift exponent or centeredness margin in genuinely extraordinary conditions.
Several admin-side controls (the centeredness margin, the daily price shift exponent, and the price ratio) carry MEV implications when used, particularly the price ratio update. We do not anticipate routine use of these controls, and the operational policy around them should be specified before deployment.
Alternatives Considered
Status quo (continue incentivising the V2 pool). Rejected. Capital inefficiency at the trading price is the single largest problem with the current setup, and it translates directly into a worse DUST price chart through the recurring epoch sell cycle. The status quo also makes both incentive and user capital inefficient. Neverland pays for headline liquidity, but only a small portion of that liquidity improves execution at the current DUST price. Users commit capital to the pool, but much of that capital does not translate proportionally into better execution, stronger fee productivity, or more efficient incentive spent..
Plain Uniswap V3 or V4 concentrated pool with Merkl incentives. Rejected based on direct prior experience. DUST volatility caused LPs to gravitate to ultra-narrow ranges and rebalance constantly, producing rebalancing cascades and pushing most passive LPs out of range. The result was incentive capture by a small group of active managers rather than durable broad-based depth.
Balancer Weighted Pool or Stable Pool. Considered. Both are determined as the wrong shape for the asset. DUST is not pegged, so a Stable Pool is inappropriate. A Weighted Pool is fundamentally V2-style math with adjustable weights and does not solve the capital efficiency problem.
Gyro 2-CLP. Considered. Gyro pools share the virtual-balance mechanism that underlies the AutoRange pool but lack the automatic range-shifting behaviour.
Open Questions
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Migration communications.
How long should the notice period be given to existing V2 LPers? -
Monitoring and reporting cadence.
What metrics are reported back to governance after migration (effective depth, realised slippage per epoch, centeredness over time, LP retention), on what cadence, and what would trigger a parameter tuning proposal? -
Overlooked areas.
Are there any areas within the RFC that are overlooked, not mentioned, or require further clarification?
Closing Statement
The case for this migration is primarily a case about the DUST price chart. The current V2 pool absorbs Neverland’s recurring epoch sell pressure inefficiently, producing predictable downward moves that are larger than the underlying flow warrants and that create a self-reinforcing setup for predatory positioning. Concentrated liquidity fixes this at the structural level by stacking more depth at the trading price. The Balancer AutoRange pool delivers that benefit in a form that does not collapse under DUST’s volatility the way previous concentrated liquidity attempts did, because it removes the need for LPs to defend their own range while it benefits Neverland’s existing incentives structure for better and more useful liquidity and stronger LP economics without turning LP participation into an active range-management competition.
The proposed parameters are conservative and well aligned with Neverland’s flow profile. The migration plan is a clean cutover with a V2 backstop preserved for redundancy. The pool type has been independently audited with no critical, high, or medium severity findings.
We invite community feedback on the topic, before this proposal progresses toward a Neverland Governance Vote.
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Balancer documentation: AutoRange Pool | Balancer
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Cantina security review of Balancer ReCLAMM, April 20, 2026: https://drive.google.com/file/d/1l-JG4SMEjLhhhvyztKGxqZQr39jcdL1A/view?usp=sharing
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AgentArena security review of Balancer ReCLAMM, May 1, 2026: https://drive.google.com/file/d/19DezDT2eW817ZnxfUvbb_SX6DrhwRh8q/view?usp=sharing
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Certora security review of Balancer ReCLAMM, April, 2026: https://drive.google.com/file/d/1I58lPCTdUJZ1PcHE0GvEsKdbqttncNEM/view?usp=sharing
and that is why, after all that, I’m open to keep working alongside Balancer. We share the same paranoia, they’ve been to war, got wounded, and came back alive with more experience this time.