Proposal 50: Creating a New pool for Venus Vault
Summary
Venus is the largest Lending market with over 2 billion TVL on BSC. And Venus updated their tokenomics in August, and it will be activated when the Venus Vault launches next week. According to the description of Venus Vault, XVS holders need locking their XVS in vault to earn revenue and voting power. It is a good opportunity for both Venus and Powerpool to cooperate together to create a new pool to improve the liquidity of XVS Vault and increasing the holder of CVP for meta governance.
Abstract
To solve the liquidity issue, we need to create a pool with incentives to attract XVS holders to deposit XVS via this pool. They can receive PXVS which is a tokenized version of locked XVS. And they can earn XVS by staking, add LP, etc. If they want to quit due to the market fluctuations, they can directly sell PXVS on DEXs and no need for waiting 7 days to withdraw XVS.
Motivation
The new product will both benefit Powerpool and Venus community for the following points.
For Venus,
1.PXVS will incentive XVS holder to lock their XVS in Vault without any worry about the lack of liquidity, because they can sell it via DEXs like pancake swap.
2.With PXVS, Venus can create a feature that user can choose different locking periods and acquire different voting weight with reward weight to incentive user to lock for a long period (Like over 42% circulating CRV locked in their protocol for 4 years)
3.The more XVS locked, the less selling pressure on CEX. Amd PXVS will only be tradable on DEXs via AMM, which offers better liquidity then trading XVS directly on Binance.
For Powerpool,
1.Acquire entry or exit fees( maybe 0.1% TBD) for pools and charge a%(TBD) Xvs rewarded from Xvs vault as managing fees and send them to Powerpool treasury.
2.CVP could be used for meta governance for Venus which will incentive user to accumulate CVP for voting power.
Specifications
First, you can click the following URL to read the Venus tokenomics and Venus vault
https://community.venus.io/t/venus-tokenomics-proposal/1446
As we mentioned above, XVS holder need to lock their XVS in Venus Vault to earn protocol revenue, and it takes 7 days to withdraw their XVS from the vault. So the pending period creates a demand for some investors who need better liquidity of the assets.
This picture shows how people Use Venus Vault.
Introduce a solution by minting PXVS token
To offer a better liquidity solution, we will design a pool for those users. The following pictures show how it works.
And the following pictures shows the token flows.
So when XVS holder deposit XVS via Powerpool, they will receive PXVS token which is a tokenized version of locked XVS, PXVS token have the following utilities:
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Earn a share of the Venus Protocol fees by staking PXVS
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Earn XVS emission from the Venus by staking PXVS
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Earn CVP incentives from Powerpool by staking PXVS
If they want to exit, they can return PXVS and waiting for 7 days to withdraw XVS, or they can sell PXVS on DEXs directly without any pending period.
To offer a better liquidity of PXVS with less Slippage when trading, PXVS holders can provide their liquidity via DEXs, and receive PXVS LP tokens, they can also earn these rewards:
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Earn PXVS trading fees from DEXs
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Earn a share of XVS from Venus Vault by staking PXVS LP token
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Earn CVP incentives from Powerpool by staking PXVS LP token
Meta Governance
CVP holders can control the voting power of XVS deposit in the pool by voting CVP as meta governance. Then the Powerpool DAO will execute making proposals or voting in Venus automatically.
Using CVP for meta governance will incentive user to accumulate CVP, and increase the number of holders significantly.
Fees
There is a a%(TBD) total fees on all XVS revenue generated by Venus on our platform:
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b% goes to PXVS LP provider, this is paid out as XVS
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c% goes to the harvest caller; this is also paid out as XVS
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d% goes to the Powerpool treasury for CVP buy back
Reference
1.Venus tokenomics: https://community.venus.io/t/venus-tokenomics-proposal/1446
2.Convex: The idea of this pool was originated by Convex who made an similar product for Cruve.fi and made a great success.
https://www.convexfinance.com/
Conclusion
This is an abstract and architecture of a new pool for Venus Vault. And more details will be discussed in PowerPool DAO. If you are interested in this product, please join us.