New Product Updates: September 2024
Greetings Divers!
Wanted to share some exciting updates on product development at Pearl and Stack.
Our primary goals are to improve on two critical areas of need.
- Emissions value
Emissions value since the launch of the ICHI vault have stabilized and started to see marked improvements. This has been a great start to increasing rewards for LPs on Pearl. However, we think there’s much more we can do from a flywheel standpoint to continue to move emissions in a positive direction. - Leverage capacity
As we’ve seen, at many times the ability to meet leverage demand on Stack is capped due to MORE liquidity depth and demand-driven peg stability. Managing the peg is critical to protocol health and a strong peg is mandatory for the growth of Stack and other products in the re.al ecosystem. Emissions value and cross-chain farming incentives are a good start, but more can be done.
Below are the key initiatives in progress to improve on these areas of need.
Caviar Auto-Compounding Vault
An auto-compounding vault is being developed for Caviar. This is being deployed alongside a modification to the current CVR staking contracts.
Without the need for additional leverage, this vault will generate a consistent source of CVR (PEARL) demand while increasing rewards for vault participants through compounded returns.
Optional leverage on the vault increases the reward/risk profile.
How It Works:
The Caviar staking chef is being modified to provide staked CVR holders with an sCVR receipt token, representing their share in the staking vault.
This sCVR token can then be deposited into the new compounding vault on Stack. On a frequent, regular basis, the vault will claim rewards for the deposited sCVR and compound those rewards to generate more sCVR for vault stakers. This can be done one of two ways:
- Buy CVR, stake and compound to the vault
- Buy PEARL, mint new CVR, stake and compound to the vault
At launch the vault will start with approach #1 above. Approach #2 will be added later and the vault will determine which option is more efficient at the time of compounding.
Users will have the option to leverage their position when depositing into the vault, where MORE is minted and used to add to sCVR to the user’s balance.
Current CVR stakers will be served a migration flow to migrate to the new CVR staking contract, receiving the sCVR token. New stakers will automatically route to the new staking contracts.
In anticipation of launch, the minting fee on vePEARL to CVR has been temporarily reduced to zero. If you’re interested in minting vePEARL to CVR to use this new product, that can be done now at zero fee.
MORE Peg Stability Module (PSM)
The MORE PSM will support MORE peg stability through simplified arbitrage opportunities and the ability to generate deeper MORE liquidity via direct minting, allowing users without an open position on Stack to more easily capture MORE liquidity rewards.
How It Works:
MORE can now be minted 1:1 with USDC and redeemed 1:1 with USDC.
50% of the MORE minted with USDC is kept for redemptions. When MORE is under peg, it can be purchased and redeemed 1:1 for USDC to regain peg. This supplements Stack borrowers ability to purchase MORE at a discounted rate to reduce debt on open positions. Redemptions for USDC are never guaranteed and are based on USDC availability.
The remaining 50% is deposited into the MORE AMO. The AMO can mint or sell existing MORE into pools when MORE > $1.00. When MORE is under peg, it will deploy stables to buy MORE and regain peg.
The option to mint MORE with USDC makes it easier for market participants to provide MORE liquidity. Deeper liquidity for MORE being a peg stability mechanism in itself.
Uni v2 Pools on Pearl and Leverage Farming
Pearl will soon deploy Uni v2 style pools for selected tokens, intended to support new leverage farming opportunities on re.al.
Beginning with MORE — USDC, liquidity providers will have the option to deposit into a selection of constant product (v2) pools or the current CL pools (manually or via ALM.) In terms of rewards, v2 pools will be treated similar to the ALM where all liquidity deposited and staked will earn rewards.
The v2 pools also allow us to integrate a new partner into re.al. Impermax Finance, which currently offers leverage LP farming on 12 different chains, will integrate the Pearl v2 pools on re.al. Combined with increased emissions value, leverage farming will help us to more efficiently scale Pearl TVL and deepen liquidity on strategic ecosystem products including MORE.
Next Steps
Development is in-progress on all of the items above.
Deployment dates will be shared once launch timing is confirmed along with details on any necessary migrations.
It takes time and effort to hone ecosystem products and rewards to meet evolving consumer needs while supporting long-term protocol health. We’re excited to keep building, continuing our efforts growing re.al into one of the most unique L2 ecosystems in DeFi.
