GMX STIP Addendum


During the Arbitrum STIP program, GMX realised strong increases in V2 liquidity, Open Interest, and overall trading volumes. Additionally, the GMX Grant Program showed strong interest from other developers to build on GMX, further solidifying the protocol as a foundational building block of the wider Arbitrum ecosystem.

With the STIP Bridge proposal, GMX takes the lessons learned from the data, builds on the STIP experiences, and adjusts its grant request to maximize the benefits to the Arbitrum DAO, GMX, and the broad Arbitrum ecosystem.

Information about STIP/STIP Backfund

1. Can you provide a link to your previous STIP proposal (round 1 or backfund)?

Final STIP Report: Leveraging the STIP Grants Program to grow the GMX and Arbitrum DeFi ecosystem

2. How much, in the previous STIP proposal, did you request in ARB?

12,000,000 ARB. With a utilization rate of 99.995% or 11,939,390.09 ARB

All remaining ARB tokens were sent back to the Arbitrum DAO.

3. What date did you start the incentive program and what date did it end?

The STIP incentive program started on the 8th of November 2023, and ended 29th of March 2024

4. Could you provide the links to the bi-weekly STIP performance reports and Openblocks Dashboard?

GMX Bi-weekly updates: GMX Bi-Weekly Update [17/11/2023]

GMX grantee Bi-weekly updates:

OpenBlock dashboard: OpenBlock Labs

5. Could you provide the KPI(s) that you deem relevant for your protocol, both in absolute terms and relative change, for the first of each month starting from October 2023 until April 2024, including the extremes? If you don’t know what KPI might be relevant for you or how to properly define them, please refer to the following document: [Arbitrum DAO] OpenBlock Labs Incentive Onboarding Spec

Below are the tables demonstrating the performance of our goals as outlined in the original STIP application. As demonstrated, GMX during this period was able to bootstrap V2, massively increase liquidity of V2 GM markets, and build on the momentum of our collaborative founding principles through a grant program – which further increased the number of GMX integrations, deepening the Arbitrum DeFi ecosystem.

TVL of vaults

DATE 01/10/23 01/11/23 01/12/23 01/01/24 01/02/24 01/03/24 01/04/24
TVL ($M) 37.87 76.37 192.54 275.06 353.12 374.62 291.57
TVL % 8.15% 16.02% 36.17% 48.62% 64.25% 65.82% 60.27%


DATE 01/10/23 01/11/23 01/12/23 01/01/24 01/02/24 01/03/24 01/04/24
DAU (K) *22,538 2,281 1,878 1,266 2,021 1,754 3,165
DAU % 98.48% 83.77% 81.94% 79.52% 88.14% 67.98% 90.22%

*1/10/23 The reason for the growth was the Arbitrum Odyssey campaign

6. [Optional] Any lessons learned from the previous STIP round?

The Grants Program was a powerful tool for engaging the Arbitrum community, but also time-consuming and challenging. Many of the aims GMX expressed in the STIP proposal have indeed proven to be achievable. That said, we could have been more strategic with handling emerging demand and supply changes. For example, seeking to minimise excess incentives to long-tail asset pools in the contraction periods, while maximising the most efficient high-performing pools.

New Plans for STIP Bridge

7. How much are you requesting for this STIP Bridge proposal?

We are requesting 5,400,000 million ARB to be distributed for Liquidity, Trading and Grants Incentives.

Liquidity Incentives: 2,400,000 ARB
Trading Incentives: 2,400,000 ARB
Grants Incentives: 600,000 ARB

This includes the ability to re-allocate up to 15% of the budget between these three categories to ensure the incentives fulfil the STIP-B goals in the most cost-effective, waste-minimizing manner.

Justification of Grant Size:

Throughout the history of Arbitrum, GMX has been committed to the success of the Arbitrum ecosystem. GMX was one of the first protocols to launch on Arbitrum, slowly establishing itself as a foundational piece of the ecosystem through its innovation in the perpetual decentralized exchange space. GMX was built with composability at the forefront, to allow for other Arbitrum projects to build on GMX and have their own success. As of 2/5/24, GMX represents $431 million of the total $2.53 billion in the Arbitrum ecosystem according to DefiLlama.

This grant will not only impact GMX but will reverberate throughout the ecosystem. Every Arb token from the DAO will be amplified through the integrations and partners who tap into the GMX Liquidity or GMX users. The STIP Bridge will continue to build on the success of the orginial STIP, where over 99.995% of ARB tokens were utilized to maximize the benefits throughout the ecosystem.

GMX continues to be one of the leaders of the Perp Dex space, generating revenue that continuously feeds the Arbitrum ecosystem through real-yield:


8. Do you plan to use the incentives in the same way as highlighted in Section 3 of the STIP proposal?*

We plan to keep the form and spirit of the GMX STIP incentives the same, in light of their achievements, while incorporating the important feedback received. Many of these tweaks are administrative and primarily concern the way in which GMX formulates its own goals, how these goals are communicated, and how they are more effectively tracked to ensure the ability to constructively review our approach retroactively.

For example, instead of a flat and predetermined amount of incentives for the liquidity pools, we intend to incentivize LPs based on a specific APR target. This will allow GMX to optimise the efficient allocation of incentives, minimise waste, and maximise the ROI for the protocol and the DAO, and continue to bring more assets and TVL into the ecosystem.

9. [Only if answered “no” to the previous question] How will the incentive distribution change in term of mechanisms and products?

The primary objectives of the grant, which will determine the incentive distribution, are as follows:

  • Onboard new users to GMX, who stimulate sustainable on-chain activity: increasing trading volume, protocol adoption, user count, and growth in Total Value Locked (TVL)
  • Encourage the growth and development of the Arbitrum ecosystem by attracting new builders to leverage the opportunity to build on top of the GMX DeFi base layer
  • A rise in the creation of DApps on top of the GMX and Arbitrum platforms, alongside an increase in the number of active users engaged with these applications, serves as a benchmark for measuring success.

With this bridge grant, GMX aims to solidify its position as a leading derivatives exchange that provides a seamless trading experience for thousands of daily users. Alongside, GMX will be implementing several new features, such as Chainlink Timestamps, which will significantly improve oracle speeds and reliability, Single Asset Liquidity pools, which will allow users to maintain full exposure to their desired assets, and 1-Click Trading improvements, which will allow for a streamlined trading experience.

Reflecting on STIP: Liquidity Incentives

Liquidity incentives were distributed to all the GM liquidity pools of GMX V2 on Arbitrum, to encourage capital inflows. TVL rapidly grew from $80 million to a peak of over $400 million.

Since the introduction of GM Pools, the best-performing markets were SOL/USD, XRP/USD, and ARB/USD, which outperformed their standard DEX AMM pool benchmarks by 37.31%, 23.53%, and 20.78%, respectively. Additionally, the average performance across all GM liquidity pools was 15.64%, highlighting their capital efficiency and robust performance.

The STIP liquidity incentives brought new capital from outside ecosystems to Arbitrum through the GM liquidity pools.For the newly supplied liquidity for these newly supplied tokens including SOL, AVAX, WBNB, and OP. These newly supported tokens including SOL, AVAX, WBNB, and OP, their supply by the conclusion of the STIP made up 75%, 81%, 95%, and 89% of the composition on GMX V2 pools respectively and as enhanced by the image below. At maximum, there was well over $23 million in these tokens, which allowed for greater Open Interest, attracting larger trades, and a better overall experience when using the GMX V2 platform.

V2 Open Interest reached an ATH of over $250 million dollars at the peak of the STIP incentives. Post-STIP, there has been a drawdown that can be attributed partly to the ending of the STIP incentives in March and partly to the changing market dynamics that lowered overall market OI and trading volumes.

S.T.I.P Bridge Liquidity Incentives

Building on the shoulders of the original STIP, the STIP Bridge proposal will also provide users with liquidity incentives. The goal is to bring new liquidity providers into the GMX V2 ecosystem, where they can earn market-leading yields while utilizing the power of the Arbitrum blockchain. GMX V2 liquidity was able to flourish thanks to the STIP incentives, peaking at over $400 million and levelling off at $300 million post-incentives.

One of the shortcomings of the previous liquidity program, however, was that certain pools were incentivized too heavily. This created incentives for users to farm pools that were underperforming their organic potential but offered a healthy APR due to the Arbitrum DAO incentives. This imbalance in rewards led to some pools experiencing significant capital flight post-incentives. For example, BNB had low utilization but over 50% APR in Arbitrum incentives, and the same trend applied to many of the smaller pools to a lesser degree, including AVAX, OP, ATOM, etc.

To counter this potential over-incentivization of pools, GMX will implement a 25% target APR for liquidity pools. This change conserves the smaller allocation of ARB tokens requested in this bridge proposal, while still providing GM pools with a powerful APR boost that should help the Abitrum ecosystem remain competitive in the current climate.

Each week the GMX Grants Committee will review the current incentives and rebalance them to meet the target requirements. Additionally, any new markets added will also receive incentives, following the same guiding principles as with the other pools. It is worth mentioning that any new pools may temporarily experience higher APRs while the liquidity and traders find their natural market balance.

Furthermore, committing to a benchmark APR will allow for an observational field better suited for analyzing the relative impact of implemented incentives. This will, in turn, allow for more insightful feedback and therefore more attentive adjustment of incentives on a rolling and iterative basis.

KPI’s of STIP Bridge Liquidity Incentives

There are two main goals of the extended STIP Bridge Liquidity allocation

  1. Bring the GMX V2 TVL (excluding V1) above $400 million in the context of an incentive program geared more towards the desired behavior of achieving “sticky liquidity”, this would represent success in attracting additional capital to the Arbitrum ecosystem and allow for a better experience for both Liquidity providers, traders, and those partners who have integrated their various solutions on top of the V2 platform.

  2. Introducing new assets during the STIP Bridge proposal, we aim to increase the number of bridged assets and bridge around $20 million worth of new assets, solidifying Arbitrum’s position as a leading DeFi ecosystem.

*Since the GM Vaults use hard collateral assets, TVL and AUM can fluctuate with the overall market. This will impact the overall data based on market conditions.

Reflecting on STIP: Trading Incentives

The GMX Trading incentives began on November 15th, 2023, and had an immediate impact on V2’s market share of total swaps and leverage trading volume. GMX reduced the trading fees on the decentralized perpetual exchange to a level comparable to the VIP tiers of leading centralized exchanges.

Traders on GMX v2 received a rebate of up to 75% of open and close fees thanks to the STIP incentives. This attracted users to trade with a minimal fee entry of 0.015% with the introduction of GMX V2. In total, we distributed a sum of 4,984,768.84 ARB in Trading Incentives.

The average trading volume on Arbitrum increased by 70.54% during the incentive period compared to the prior 3 months. The average daily volume on V2 during the campaign period was $197.84 million.

Over its eight months of existence, GMX v2 has generated a total trading volume of $34.38 billion. From the start of the STIP campaign (in the second week of November), v2

trading volume shows a clear upward trend. March was the most successful overall month, with the STIP incentives boosting GMX v2 trading volume up to $7.74 billion, and $14.52 million in protocol fees collected. During the entire STIP incentives campaign, GMX accumulated $29.72 billion in volume and generated $27.10 million in fees.

Source: Token Terminal | Dashboard

This was the highest fee generation across all perpetual DEXes, demonstrating the demand among traders and the product-market fit of v2. After the incentives kicked off, GMX was the highest fee generating protocol across perpetual DEXes, demonstrating the effective utilization of the Trading incentives by GMX.

In addition to the rebate program GMX also ran a 2 week trading competition focusing on attracting new traders to the V2 platform. While the trading competition brought in new users to the platform, it is not expected that we will run another competition using the bridge incentives.

STIP Bridge Trading Incentives

Building on the STIP grant received from the Arbitrum DAO, GMX plans to continue with a trading incentives model that received positive feedback from the Blockworks review of the GMX STIP Grant. In the previous STIP grant GMX distributed traders with up to a 75% rebate on the total open and close fees collected for a trade. When the GMX STIP Grant was received weekly trading rebates began to show their effectiveness, initial volumes without incentives were 1.5 billion USD weekly. Following the STIP Rebates, weekly volumes steadily increased peaking over 3.5 billion, this represents a 133.33% increase in the weekly volumes at the peak.

As outlined in the data, providing traders rebates can provide a material boost in on-chain usage of GMX perpetuals, which in turn generates for usage of the Abritrum chain. The STIP Bridge uses the previously successful model on a lowered down scale, incentivizing up to a 75% rebate in trading fees but using a smaller number of allocated Arbitrum.

Weekly fees allocated to trader rebates may be adjusted but cannot exceed refunding users more than 75% of their opening and closing costs, using 75% as a threshold will prevent the program from being exploited by actors who may try to exploit the program. GMX focuses on growing the ecosystem system organically and understands that if users have too many incentives it can lead to misleading results that skew the data and leave the DAO with inconclusive results on the success or failure of the grant received.

Trading incentives will be established initially on a weekly epoch. It is proposed that combined trading fees and rebates can bring average fees to a level comparable to Binance VIP0 levels.

KPI’s of STIP Bridge Trading Incentives

There are 3 main goals of the GMX Bridge Trading Incentives

  1. Generate higher volumes, The average daily volume on V2 during the previous campaign period was $197.84 million, the target for the bridge campaign is for over $200 million in daily average volume.
  2. Grow the number of active traders on the GMX V2 Platform, increasing the number of daily users by 100%
  3. Grow the total OI of the platform, increasing the average weekly OI by 25%

Reflecting on STIP: Grants Incentives

For the GMX grants program, we received a total of 54 applications and we were able to fund 22 applications. We allocated around 1,673,500 ARB to the grantees, and eventually dispersed close to 1,290,000 ARB. The grantees focused on integrating GMX V2 trading generated a whopping 573 million in volume during the campaign. On the liquidity side, the grantees achieved a combined TVL of 40 million on their platforms — significantly deepening the liquidity of the GM markets.


Similarly we plan to continue with the grants program with the Stip bridge incentives proposals. GMX will support protocols and integrations that promote the adoption of GMX V2. A portion of the STIP Bridge grant has been allocated to supporting projects built on the GMX V2 platform, aiming to achieve innovation and development within the broader Arbitrum ecosystem.

The primary objective of the grant initiative is to encourage the expansion of the broader, composable GMX V2 ecosystem by providing development assistance through grant incentives. This initiative is expected to increase liquidity and trading activity on GMX while bolstering the Arbitrum DeFi sector. Support will be directed towards wallets, Perp aggregators, Telegram bots, projects integrating with GMX V2’s GM Pools, and emerging protocols that meet specific requirements and prioritize user safety and security.

These integrations will incentivize users who utilize GMX contracts through these channels, aligning with the overarching objectives. Users engaging in liquidity provision, trading activities, and contributing to the enhancement of GMX’s features, integrations, grants, and Request For Proposals (RFPs) will receive incentives. This strategy establishes a symbiotic relationship between GMX’s growth and the broader ecosystem, facilitating mutual benefits and collaborative development.

Our goal with these integrations is to incentivize users who utilize GMX V2 contracts through these channels in a manner that aligns with our objectives. These users will receive incentives for providing liquidity, engaging in trading activities, and contributing to the enhancement of GMX’s features.

The grants program will play a crucial role in attracting new talent to the ecosystem and realizing innovative ideas. GMX is committed to providing limited operational support to ensure the success of protocols built on top of GMX as a base layer. This approach reinforces the connection between GMX’s growth and that of the entire Arbitrum ecosystem, encouraging mutual benefits and collaborative development.

Anti-Sybil and Anti-Abuse Parameters:

One of the highlights of our incentive program was the extremely low sybil ratio of ARB claimed at ~0.07%, as of February 24, 2024, as reported by OpenBlock Labs. To ensure the integrity of the incentive program, anti-Sybil and anti-abuse parameters will be implemented. These parameters will aim to generate organic volume and attract genuine users to the Arbitrum ecosystem. Measures will be established in consultation with the Liquidity Multi-sig and the GMX DAO to attempt to prevent fraudulent activities and ensure the program’s success.

By implementing this breakdown of incentives and incorporating anti-Sybil and anti-abuse parameters, we aim to foster a healthy and sustainable ecosystem on the Arbitrum network.

10. Could you provide the addresses involved in the STIP Bridge initiative (multisig to receive funds, contracts for distribution, and any other relevant contract involved), and highlight if they changed compared to the previous STIP proposal?

  1. The address will be:
  • Multisig to receive the incentives: 0xB6fd0BDb1432b2c77170933120079f436F3bB4fa
  • Contracts that will distribute the incentives: N/A

The multisig used to receive the incentives will be the same, while the incentive distribution contract will be changed compared to STIP.

11. Could you share any feedback or suggestion on what could be improved in future incentive programs, what were the pain points and what was your general evaluation of the experience?

The overall process and experience was positive. For GMX, one thing we learned is that being a sector leader within DeFi means digging deeper than most other fledgling projects in order to squeeze out all potential market share capture and growth. Retrospective feedback alerted us to consider more intent-driven, impact oriented tracking frameworks, and we think such insight is exactly in the right direction of the former mentioned goals. It was also suggested that more reflection be captured referencing the previous week’s performances; using this data GMX will incorporate the historical review necessary for ends of optimization and adjusting to shifting market conditions. GMX wants to continue stewarding a robust and vibrant DeFi ecosystem on Arbitrum and to those ends seek to take advantage of any and all feedback over the course of current and potential other grant programs offered by Arbitrum DAO.


Hello @Saurabh ,

Thank you for your application! Your advisor will be SeedLatam Gov @SEEDGov

Please join the LTIPP discord and ping your advisor in the general chat so they can create a new channel and start communicating with you.


Hi @Saurabh we are waiting for you in the discord !

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Wow, what a write up, appreciated!

That ARB really worked with GMXv2 and facilitated many new teams/builds, and with the updates made to GMXv2 since the STIP ended, this STIP will be just as productive with less ARB if not more productive. Thanks Arbitrum DAO and thanks GMX DAO for the hard work put in to push this chain to the masses.

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From the start of Umami initiating a grant proposal, GMX’s grant team was engaged with prompt responses from Saurabh and his team. Their security requirements were fair and Umami core contributors were able to comfortably meet the security requirements. This ensured a safe and effective incentives program. Umami core contributors are proud to have administered an effective GMX grant incentive program with great success. I would highly recommend future incentive programs model GMX’s frameworks to ensure fair and effective incentive programs in the future.


It was a pleasure working with the GMX team through the GMX (Open) Grants Program. We felt supported through the entire process from the application right through to implementation of the milestones.

In particular, the team displayed a high level of professionalism including KYC checks and always honouring their commitments back to the Arbitrum DAO. For instance, we were not able to hit some of our final milestones in the time allocated, and those $ARB were thus returned to Arbitrum DAO. We are pleased however that the process enabled us to complete our integration with GMX v2 in a timely manner. Whenever we needed technical assistance, either a core member or a GMX developer was available to help. The Grant Program was an overall positive experience, and one which put us in a strong position for the subsequent LTIPP for which we were successful. The process made us more aligned with Arbitrum’s values and more deeply integrated with GMX as a partner platform


We at Vaultka are immensely grateful for the support and smooth collaboration we experienced with GMX during the recent GMX grants program. The opportunity to work closely with GMX has not only enhanced our operations but also contributed significantly to our growth and development within the Arbitrum ecosystem. The professionalism and efficiency from the GMX team were exemplary, fostering a productive partnership that we deeply value. This program has undeniably propelled us forward, and we look forward to future endeavors together, continuing to build on this successful foundation.

Furthermore, the GMX grant has played a crucial role in establishing strong social proof among the community, council, and delegates. By effectively utilizing the incentives provided by the grant, we have demonstrated our ability to maximize resources and deliver tangible results. This has further solidified our reputation as an efficient and reliable project within the ecosystem. We are proud to showcase our achievements and grateful for the confidence and trust that the GMX grant has instilled in us.


Working with GMX STIP was an exceptional experience. They were highly organized, articulate, and efficient, playing a crucial role in helping our project achieve its KPIs in the most effective manner possible. Thank you for your outstanding support!


At D2 Finance, we greatly appreciate the contributions GMX has made to the Arbitrum ecosystem.

GMX provides the framework for trading spot/leveraged perp contracts with the essential liquidity, security, and scalability needed to execute sophisticated strategies. With continuous liquidity and efficient trading mechanics, GMX ensures assets are always available for trading at the scale required by D2 Finance.

During our Proof of Concept, we utilized our portion of ARB incentives from GMX as part of the STIP program to achieve over $3.4 million in trading volume through GMX V2 and realized notable performance ROI in our vaults. These incentives, which should be particularly notable to the Arbitrum Foundation, supported a stellar first epoch of trading in our ARB++ strategy, contributing to 8% of a 32% return on investment over a single 35-day epoch, realized as ARB.

Throughout the STIP program and beyond, the GMX team consistently demonstrates professionalism and exemplary communication, fostering growth within the GMX and Arbitrum ecosystems and among partners. We deeply value their contributions, guidance, and support.

GMX is a crucial protocol for Arbitrum’s past growth and future success and we look forward to continued collaborations together as we scale.


Following feedback on the proposal to establish the STIP Bridge, it was agreed to involve the LTIPP Advisors in this process with the mission to “help applicants gain insights into their proposals. This not only guides applicants through the process but also ensures that the DAO will review better proposals.”

Despite the inclusion of Advisors, this process does not involve the Council, leading us to believe that this addendum places a significant burden on the delegates who must review all the proposals. One of the reasons for the LTIPP was precisely to avoid this excessive burden. Moreover, the optimistic model adopted in this phase could raise concerns about the real control the DAO will have over these proposals, as reviewing six months of data for each applicant is time-consuming.

For this reason, we decided to accompany each application we reviewed with a brief report. We ask the delegates not to take this as an in-depth or definitive basis for deciding your vote, but rather as a guide that can potentially raise questions for your own analysis.

Regarding GMX, there is an excellent and very detailed report by Blockworks that we refer to because we believe it is important for all delegates to read it to form their opinion. It raises very valid points and questions about the proposal, performance, and results of GMX STIP incentives distribution.

Regarding their results, as shown by GMX’s TVL on the Open Blocks dashboard, before incentives were introduced, the total TVL was $428 million ($352 million in v1 and $76 million in v2). At its peak in early March, the TVL reached $522 million ($154 million in v1 and $368 million in v2), and as of today, it totals approx. $376 million ($116 million in v1 and $260 million in v2).

In their addendum, GMX displays and shows metrics regarding only v2 performance, which is the one that received incentives. It is true that the goal of migrating TVL from v1 to v2 was achieved, which is beneficial as the capital is used more efficiently in v2. However, one could argue that there was no sustainable increase in overall TVL over time, as the current overall TVL is lower than before the incentives were introduced:

We understand that there was also a significant change in market conditions during this period that could affect the TVL.

One interesting finding and we believe it’s a great update to the execution, and that could partially explain the reasons of the TVL drop, is:

We would like to see more research on this in the conclusion of the bridge STIP incentives distribution. Where is capital going after incentives?

To avoid the same situation, GMX committed to capping the target APR to 25% for liquidity pools. We think this is great and could be the starting point of a benchmark APR for incentives distribution.

One of the points raised by Blockworks in their report is the lack of data of the origin of the capital that came to GMX during the incentives distribution. Was new TVL that came to Arbitrum?

GMX provided an answer to that question in this addendum:

Something that we’d like to be improved is the discretion with which their Grant Committee managed and continues to intend managing the ARB incentives distribution among the liquidity pools.

We understand and agree that there must be flexibility when assigning incentives to pools in order to adapt to market conditions and situations that may arise. But it would be a good practice to share the objective criteria that the committee will use in order to select the incentivized pools and then leverage that criteria to explain the changes in the distribution of incentives or the addition of new pools in the bi-weekly reports.

Regarding trading volume, as noted by Blockworks, it has been stickier following the incentive program’s conclusion.

On trading, another interesting finding and proposal from the GMX team consists of fee rebates: 75% is their proposed threshold to prevent programs from being exploited. This was also mentioned in Synthetix LTIPP application:

It would be really good to see research conducted on this aspect. Is 75% the number?

We appreciate that the applicant set measurable KPIs both for their TVL and Trading Volume metrics that will receive incentives.

Finally, regarding Grant Incentives, we echo Blockworks concerns regarding funding protocols that were also STIP incentives recipients.

We noticed in all the applications we reviewed that there is a significant drop in TVL during the last month. We believe there are multiple reasons for this, and there isn’t enough time to conduct a thorough and conclusive analysis of the long-term effectiveness of the STIP.

dappOS has experienced exponential growth in users, trading volume and TVL during the GMX grant program. This cannot be achieved without the support by the GMX contributors, they helped us from day one on the grant proposal and guided us throughout the grant program therefore we’d like to say a big thank you here.

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