Apply CVP boost rewards to staking YLA tokens, not YLA-USDC SLP tokens.
Prolong the CVP Boost for YLA for next month starting from the 27th of April.
Using CVP Boost for the YLA-USDC SLP token is inefficient and too complicated, and costly for PowerPool users. We should use CVP boost for YLA staking - this will simplify things and offer additional interest for just holding YLA. Additionally that, we should prolong CVP Boost for YLA to next month.
The main value of holding YLA is generated interest by the operation of Yearn v1 Vaults. Now YLA generates something like 30% APY for the holder (my napkin assumption). However, all liquidity mining programs (Sushi Onsen, CVP Boost) target YLA-USDC SLP tokens. But, it is not efficient due to the following reasons:
- This pair is 50% YLA 50% USDC. It means that users have to supply an equivalent amount of USDC to this pair. However, YLA generates 30% APY while USDC generates nothing. It is much more efficient to supply 100% of USDC to YLA and not split it 50/50.
- Users have to pay a lot of gas costs:
-> Supply liquidity to YLA-USDC Sushi pair
-> Stake SLP token (either in Sushi or CVP mining)
When It is time to withdraw profits:
<- Unstake SLP tokens
<- Redeem SLP tokens and receiving YLA
<- Redeem YLA to USDC
It costs from $45 to $80 to supply liquidity on Sushi and the same amount for redemption them back. Basically, each LP should pay this cost at least twice (supply/withdraw).
Analyzing the YLA-USDC pair, it is easy to find out that volumes are quite low (except for a couple of days). And it is not surprising since the team offered very cheap ZAP solutions + Sushi pair has too big slippage on large stablecoins trades due to its constant invariant x*y=k nature.
People use YLA and barely use YLA-USDC for buying/selling YLA. They use ZAP.
So, we need to make a CVP boost on YLA, not YLA-USDC. It will simplify users’ journey, save gas costs and eliminate this mess with boost understanding by the community. Now it will be simple - stake YLA + CVP, receive boosted rewards.
Use the previous formula for CVP boost, but replace SLP with YLA. To maintain the similar (as it is possible) proportion YLA<->CVP, I suggest establishing a minimal boost threshold as 0.014 CVP per YLA and a maximal CVP stake as 0.14 CVP per YLA (from 5% to 50% of YLA liquidity in CVP). All formulas are in this post. Extend the CVP Boost program from 27 April to 27 May.