ADD: Kick low-value pools from THORChain
Security is a scarce resource on THORChain. Productive liquidity (makes swap revenue) pays for security. Liquidity that is not productive is a drag on the system.
Find and kick low-productive pools from THORChain.
Every pool churn, kick the lowest productive pool from THORChain below a threshold.
The productivity can be measured by Liquidity Unit Value, which is the square root of the squared value of the assets in the pools, divided by the pool units. LUVI always increases.
r = runeBalance a = assetBalance p = poolUnits LUVI = sqrt(r^2 + a^2) / p
LUVI goes up the least in the pools that make the least money.
Every pool churn, snapshot LUVI per pool and save. Every church, compare the new LUVI with the old one, and kick the lowest LUVI pool into standby. Whilst in standby, the pool pays a churn fee and will eventually be depleted.