Hey everyone, I’m Rob. My group Revest Finance previously created the Revest Protocol and has since been building on top of that to create Resonate. You can find out more about it in our docs here.
For the past few months, we’ve been working with Romy on fine-tuning a proposal for you. I’ve attached it to this post and look forward to working with you to fine tune it more! We’re doing something fairly similar to the way Velodrome launched themselves, with a large lineup of pre-launch partners, and we’d like to have yall as part of that – as the proposal describes, the farm we’re looking to pair you with is Yearn, and they are onboard with co-marketing for this proposal should it pass and us become partners.
Scope: Approve deployment of 250,000 MIM to Resonate Yield Futures protocol within 2 weeks of the passage of this proposal or 1 week before the public launch of Resonate (whichever is later). This capital is to be deployed in 5-10 separate and staggered transactions, at the discretion of those to whom deployment responsibilities are delegated to.
Become a launch partner with Resonate.
a. Co-market utilizing Twitter, Medium, and any other social media platform.
b. Display each other’s logos on one another’s websites.
c. Include a link to the Resonate Dapp (or the relevant Resonate pool(s)) on the Abracadabra Dapp.
Deploy MIM and diversify treasury to DAI, USDT and USDC (at a 150% multiplier).
Lock-down $5M of mercenary liquidity for 12 months.
Offer upfront yield payouts on Stablecoin farming of 5%.
What are we proposing?
Currently, the Abracadabra treasury has been holding MIM. This serves no direct benefit to the treasury. Coincidentally, the treasury is sidelined from the Curve MIM Yearn Vault (composed of MIM, DAI, USDT and USDC), which could yield the treasury incredible returns (average APY of 6.7% over its lifetime). Resonate offers a solution that would allow Abracadabra to use its MIM treasury in a more productive manner. Using a Resonate pool, Abracadabra can emit MIM tokens in a lump sum to users in exchange for locking Curve MIM liquidity, while also redirecting the Curve MIM rewards on that pool to the treasury. (Yearn automatically harvests the CRV and CVX rewards for more Curve MIM).
Under this proposal, Abracadabra will deploy up to 250,000 MIM to a Resonate pool to incentivize users to deposit Curve MIM into the Resonate pool while earning a return of 50% on the MIM deployed. These tokens will be locked for a 12-month term and deposited into the Curve MIM Pool yVault, earning yield.
When a user deposits into the Resonate pool they forfeit the Curve MIM yield in return for an upfront payment in MIM tokens.
What does this mean for Abracadabra?
Through their ongoing acquisition of CRV and use of it to direct emissions onto the MIM-3CRV pool, we estimate that Abracadabra could earn an average return of 7.5% in MIM-3CRV (MIM, DAI, USDT and USDC) on the 250,000 MIM deployed. Abracadabra would diversify its treasury via a synthetic swap into other stablecoins while, simultaneously, earning a yield on those stablecoins through stablecoin boosting.
Through this program, Abracadabra incentivizes locking $5MM of mercenary liquidity into the stablecoin farm for a period of 12 months.
Learn more about Resonate here.
Resonate is a Yield Futures Protocol developed by Revest Finance and built on top of Revest’s Financial NFT (FNFT) technology.
Using Resonate, we’re able to separate the principle and interest components of a position by issuing two FNFTs—one containing the principle and the other containing the rights to future interest on that principle.
Resonate facilitates the commerce of the rights to future interest by matching Issuers—who want to sell off their interest rights for a one-time upfront payment—and Purchasers—who want to buy the rights to future interest for a one-time upfront payment.
For an issuer (typically ‘retail investors’ and ‘smart money’) the risks are minimal. Mainly, they’re restricted to token price fluctuations.
A purchaser, on the other hand, is exposed to opportunity cost. This implicitly points to the optimal candidate to take on the role of the Purchaser: DAOs and Protocols!
Normally, Abracadabra would be unable to deploy Curve MIM from the treasury to the farm as:
- they would have to swap current treasury assets to obtain Curve MIM, and
- their direct deployment would dilute the yield provided to that farm.
This means as a purchaser, Abracadabra will not experience any form of opportunity cost due to not being able to utilize these tokens to begin with.
Purchasers hold their principal within the Principal-FNFT and, therefore, retain a fully liquid FNFT throughout the term, allowing them to sell it on OpenSea, LooksRare or SudoSwap should the need arise.
5% of the principal is paid upfront in MIM to incentivize ‘retail investors’ and ‘smart money’ to enter the Curve MIM Yearn Vault, giving them instant yield paid in MIM.
Their Curve MIM is held within a Principal-FNFT for 12 months.
The FNFT remains fully liquid throughout the term, allowing them to sell it on OpenSea/LooksRare/SudoSwap should the need arise.
The Curve MIM is deposited into the Curve MIM Pool yVault on Yearn. Yearn supplies Curve MIM to Convex to earn CRV and CVX. These rewards are harvested by Yearn and sold for more Curve MIM, which is subsequently deposited back into this vault.
The Curve MIM rewards generated are delegated to the Interest-FNFT held by the Abracadabra treasury and these rewards may be claimed at any time.
*Please note that the “per 100 tokens deposited” is a standardized value and the minimum amount of tokens required will not be this large.
Incentivize liquidity on Curve MIM farm
Utilize up to 250,000 MIM to incentivize Curve MIM deposits for 12 month terms
Pay out 5% upfront (in MIM) resulting in 125k of revenue for Abracadabra (an ROI of 50%)
- Issuer receives 5% immediately rather than waiting 12 months for 7.5%
Adjustments to upfront payout may be made on an as-needed basis by switching pools. There is no limit to how many pools may be created on Resonate and movement between them is free.
Projected TVL Gain within MIM-3CRV: $5MM
Abracadabra ROI: 50% return, $125,000 profit
Business and Technical Requirements:
Resonate would deploy an adapter for Yearn that will allow Abracadabra to claim the interest in MIM-3CRV. This adapter has been audited twice and reviewed by BadgerDAO’s Solidity lead.
Fees: 5% on all upfront payments to the issuer; 5% on all interest generated through the lockup period to the purchaser. No fee assessed to principal on deposit or withdrawal.
Glossary of Terms:
FNFT - Financial Non-Fungible Token.
Yield Futures - the separation of a stake’s periodic interest payments from its principal repayment obligation to create a series of individual FNFT’s. With Yield Futures, the underlying stake becomes a principal-bearing FNFT and each interest payment can be claimed through the interest-bearing FNFT at any time.
Principal FNFT - This is the FNFT where the original sum of tokens staked is held.
Interest FNFT - This is the FNFT where the interest from the principal FNFT will be sent. You are able to withdraw the interest accrued at any time.
Synthetic Swap - When you use Resonate to trade your own token, or another token, for a completely different token to diversify your treasury.
Stablecoin Boost - When you deploy stablecoins from your treasury to receive higher than normal yields if you were to just deploy to a stablecoin farm.
Mercenary Liquidity - Liquidity that is deposited into a liquidity pool solely to reap the benefits, leaving the minute that things turn difficult. If mercenary liquidity is not locked-down, its owners will pull LPs at the first sign of market instability and sell the native token into the now more-shallow liquidity pool, pushing token prices into a downward spiral.
*Curve MIM is equivalent to MIM-3CRV