We have developed something special for you! Organic APR πΏπ§βπΎ
Introducing Organic APR in one sentence:
The more people contribute to a pool, the higher the APR π°π
Why do we need it? And how would this work? Check out this thread for more information. π
Introducing Organic APR in one sentence:
The more people contribute to a pool, the higher the APR π°π
Why do we need it? And how would this work? Check out this thread for more information. π
Traditional yield farming works like this:
The DEX interested in farming fixes an emission schedule for yield farming tokens.
Participants in the yield farming obtain a share in the emitted tokens, proportional to their share in the staked liquidity.
The DEX interested in farming fixes an emission schedule for yield farming tokens.
Participants in the yield farming obtain a share in the emitted tokens, proportional to their share in the staked liquidity.
There is a huge problem:
Users want to provide liquidity to earn rewards.
But more liquidity providers means earning
a smaller part of the emission.
Consequently, there is no incentive to spread the word and onboard more users. They will only reduce the APR for early adopters.
Users want to provide liquidity to earn rewards.
But more liquidity providers means earning
a smaller part of the emission.
Consequently, there is no incentive to spread the word and onboard more users. They will only reduce the APR for early adopters.
But we should want more providers!
More providers bring more liquidity.
More liquidity attracts more volume.
More volume brings sustainable APR through LP fees.
More providers bring more liquidity.
More liquidity attracts more volume.
More volume brings sustainable APR through LP fees.
We want to overcome this with a simple formula.
It makes sure that more liquidity will trigger high yield farming rewards - and thus more overall APR for all participants!
It makes sure that more liquidity will trigger high yield farming rewards - and thus more overall APR for all participants!
We worked out a formula that will scale the token emission with the provided liquidity.
The formula is capped at a target liquidity that is desired to ensure smooth trading.
The formula is capped at a target liquidity that is desired to ensure smooth trading.
Some examples:
500k ADA TVL - 7.3% APR
1M ADA TVL - 14.5% APR
2.5M ADA TVL - 36.5% APR
5M ADA TVL - 73% APR
500k ADA TVL - 7.3% APR
1M ADA TVL - 14.5% APR
2.5M ADA TVL - 36.5% APR
5M ADA TVL - 73% APR
You can find more details in this medium article: medium.com/@muesliswap/abβ¦
Tell your friends - it is beneficial for us all! π₯π§βπΎ Let's grow #Cardano #DeFi together!
Tell your friends - it is beneficial for us all! π₯π§βπΎ Let's grow #Cardano #DeFi together!
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