Add xWOO as collateral on BSC to borrow MiM

Summary:

This is the proposal to add xWOO as collateral on BSC to borrow MiM. xWOO is the interest-bearing token in WOOFi, a sPMM decentralized exchange launched by WOO Network. xWOO continuously earns yields from the swap fee in WOOFi. Currently, ~$35M WOO is staked as xWOO in WOOFi yielding around 7% in 7-day average APR. And there are ~5,000 xWOO holders and 7,700 WOO holders on BSC.

Background:

WOO Network is a deep liquidity network connecting traders, exchanges, institutions, and DeFi platforms with democratized access to the best-in-class liquidity, trading execution, and yield generation strategies at lower to zero cost. WOO Network was incubated by Kronos Research, a multi-strategy trading firm that specializes in high-frequency trading (HFT), arbitrage, and CTA, averaging around $5-10 billion of daily trading volume on global cryptocurrency exchanges. WOO Network also received strategic investment from Binance Labs and Three Arrow Capital in its recent Series A round.

WOO Network processes $500M - 1B volume across CeFi and DeFi on average per day, of which $20 - 50M is from a combination of market-making and trading strategies on BSC. With the launch of our flagship DEX WOOFi, we are committed to boosting the volume of WOOFi.

WOOFi was featured in BSC’s MVBIII monthly stars for September. And its novel sPMM and on-chain market data feed allow WOOFi to provide competitive pricing with a fraction of TVL compared to AMMs, as a result, WOOFi can achieve over 300% capital efficiency and the swap fee is only 0.025% - the lowest across all DEXes. 0.02% of each transaction on WOOFi is used to buy back WOO and reward xWOO holders on a daily basis.

In addition, the recently launched WOO DAO, with its passionate DAO members and $300M WOO in its treasury, is dedicated to supporting WOO Network’s growth in DeFi and landing mutual beneficial partnerships.

Proposal:

Allow xWOO to be used as collateral on BSC to borrow MiM. The specifications are similar as CAKE but with a lower collateral ratio, considering WOOFi is a newer protocol. (Max collateral ratio: 60%, liquidation fee 12.5%, borrow fee 0.5%, interest 2%)

Benefits:

  • Attract more users to Abracadabra on BSC, diversify risks for depositors and MiM holders
  • Increase TVL of Abracadabra on BSC
  • WOO Network supported $SPELL in October, we can prioritize the support for SPELL in our DeFi market-making and trading strategies
  • WOO DAO potentially borrows MiM with xWOO and hold MiM and Spell in its treasury

Considerations/Risks:

  • $40M traded on WOOFi since the alpha launch in Nov, ~$35M WOO token staked in WOOFI as xWOO
  • There is a 7-day unstaking period to withdraw WOO from the staking contract without paying any penalty (5% for early withdrawal).
  • While WOOFi is bootstrapping its volume, additional WOO token rewards will be committed to ensuring the APY is higher than the borrowing interests
  • WOOFi’s smart contracts have been audited by multiple audit firms such as Certik and Verilog

References:

28 Likes

Good proposal! I saw Binance labs and 3AC recently invested in Woo and WooFi swap; Nice to have xWoo to be supported as collateral here!

8 Likes

Just joining (full disclosure) to say that this is something WOO Network and the WOO DAO has targeted for awhile, ever since the plan to launch xWOO was being discussed.

Think there could be a lot of synergies between communities and we would do everything we can to support this integration, driving new users and community members to Frog Nation.

12 Likes

As a WOO community and DAO member, I wanted to voice support for this. We see what’s happening in Frog Nation and would love to work together. It’s my feeling that the WOO and Abracadabra communities share a lot of common values, of which includes being transparent and empowering individual people through DeFi.

8 Likes

As a UST degenbox user, WOO holder and WooFi staker, I’d be thrilled to see xWoo on Abra on BSC. The future synergies between platforms could be powerful (MIM supported on Woo network to for deep liquidity etc).

4 Likes

Two fantastic communities coming together. Wholly support this proposal and looking forward to utilising the Abracadabra platform

7 Likes

As a longtime holder of WOO tokens and a supporter of Abra I’m behind this. 2 teams that could have a lot of Synergy. MIM trading pairs on WooFi next?

2 Likes

Great proposal . Fully behind this one .

3 Likes

Great proposal, a win win for both communities and projects! Fully support this one

2 Likes

As a Woo token holder, I’m looking forward to any collaboration between the Woo team and Daniele. That why I want to voice my support for this proposal.

3 Likes

Love this proposal. All for this! :ok_hand:

2 Likes

The retail investor in $WOO is a strong handed investor. This would only benefit all parties involved with this proposal and would love to see this addition. Let’s make it happen!

2 Likes

Solid proposal love to see mim adoption

3 Likes

Fully support this proposal! Let’s make this happen.

2 Likes

This sounds interesting! Support more assets in WOOFi and let token holders enjoy lower fee is on the roadmap

2 Likes

the more we add the more we occupy! Let’s Go

1 Like

I don’t know what’s going on, but I support this idea

3 Likes

Glad this is at RFC now. really excited for this, happy to answer any question related to WOOFi or xWOO

3 Likes

Love the idea of adding xWOO to Abra.

1 Like

a quick update on WOOFi - with the recent volume increase ($9.6M ATH daily volume), the APY of xWOO jumped to over 8%. really looking forward to the proposal being implemented so that more people can take self-repaying loans from abracadabra.


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1 Like