Champion VARA- cpVARA
Overcollateralized version of $veVARA (Équilibre DEX - KAVA EVM chain)
$VARA is the native token of Équilibre, an ve(3.3) AMM (Automatic Market Maker) based on Velodrome, and designed to provide large liquidity & low swapping fees.
It rewards holders with a share of the platform's revenues and also acts as a governance token for its weekly pool incentives gauge. VARA has a decaying emissions model.
Users can stake and lock their $VARA tokens on Équilibre for a fixed period between 1 week and 4 years, to receive a vote escrow NFT ("veVARA"), which is used to record the amount of $veVARA held by the user.
$veVARA holders receive four benefits:
- a share of the trading fees from swaps using the platform's liquidity pools;
- the ability to direct $VARA emissions distributed to platform liquidity providers;
- weekly veVARA distribution (rebase);
- the opportunity to earn bribes from external parties by voting for their incentivised liquidity pools.
$veVARA positions can be merged, and sold on the secondary market. $veVARA time lock period can be extended.
The amount held by a given user decreases steadily to zero as the lock period moves towards its completion. Weekly rebase is to safeguard $veVARA holders from dilution and to enable a dynamic distribution of $veVARA among participants over time, the anti-dilution level has been capped at 30%;
$cpVARA is an overcollateralized version of $veVARA staked for $cpVARA to take advantage of the various benefits offered to Équilibre stakers.
User can mint $veVARA to $cpVARA on the $cpVARA page at a 1:1 ratio. There will be incentivised liquidity for $cpVARA-KAVA LP.
When $cpVARA value fall down below 85% of the $VARA value (peg <0.85), the contract will not allow to mint more $cpVARA from $veVARA.
User can mint $VARA to $cpVARA via smart route in the $cpVARA page. When $cpVARA is above peg, $VARA will be locked to $veVARA and mint $cpVARA at a 1:1 ratio. When $cpVARA is below peg, $VARA will be used to directly buy $cpVARA in the $cpVARA liquidity pool.
Burning mechanism of $cpVARA is based on the 1% transaction fee/tax including buy/sell/add & remove liquidity
Transaction fee/tax allocation:
- 50% of the fee/tax will go to Champion Treasury and become permanent voting power of Champion.
- 50% of the fee/tax will go to KAVA chain's dead wallet, and the $VARA back for those $cpVARA will be permanently locked in the contract, permanently out of circulating supply.
From the begining of the contract, $cpVARA token is fully backed 1:1 by $veVARA.
By the time, with the burning mechanism, when user buy/sell/add & remove liquidity of $cpVARA and generate fee, half of the fee $cpVARA will be sent to dead wallet and permanently out of circulating. The back ratio of $cpVARA will be above 1:1 by $veVARA and $cpVARA in the contract will become over-collateralized.
The more volume of $cpVARA --> the more fee is generated--> the more backed ratio of $veVARA is--> the more overcollateralized $cpVARA is.
When you mint $cpVARA, the contract will immediately try to stake and lock the deposited $veVARA into main $veVARA.
Once the contract's $veVARA is staked and locked into main $veVARA, it receives four benefits:
- a share of the trading fees from swaps using the platform's liquidity pools;
- the ability to direct $VARA emissions distributed to platform liquidity providers;
- weekly $veVARA distribution (rebase);
- the opportunity to earn bribes from external parties by voting for their incentivised liquidity pools.
As the $cpVARA contract perpetually re-locks its $veVARA deposits, it always strives for the maximum amount of voting power and benefits.
Earned trading fees, bribes and rebase are regularly harvested, swapped for $cpVARA and will be used to bribes $cpVARA Pool on the Dex.
Once you're holding $cpVARA, you can create $cpVARA-KAVA LP and stake into the dex to earn more $VARA.
Where our $cpVARA contract earns trading fees, rebase and bribes by deploying its $veVARA on the protocol, those protocol revenues are swapped back to $cpVARA and use to bribes for $cpVARA Pool. This maximises the yield for holders above what they could obtain alone from the protocol.
Champion strives to maintain some of the lowest yield-optimizing fees, and charges standard fees on its $cpVARA vaults.
Total of 6% perfomance fee, including:
- $Cham staker and/or bribes for CHAM pool on the Dex: 2.5%
- CF Treasury: 3%
- Contract strategist: 0.5%
Lets detail 3 level of $cpVARA peg:
Peg Level | $cpVARA Peg | Recommendation/Market reaction |
|---|---|---|
1 | Peg > 1.0 |
|
2 | 0.85 < Peg < 1.0 |
|
3 | Peg < 0.85 |
|
$cpVARA will healthily maintain peg at Level 2 (0.85 < Peg < 1.0).
No. All $veVARA voting power will be used by Champion to vote in the weekly liquidity pool incentives gauge.
Votes will typically be directed either to the liquidity pools offering the most in trading fees and bribes, or to the liquidity pools which support $cpVARA token.
The $cpVARA contract will harvest all trading fees, rebase and bribes from the protocol and swap those for more $cpVARA to bribes for the next epoch on the Dex. Voting on Dex's incentivised liquidity pools takes place on its web app.
- If you want liquidity for your $veVARA to farming more yield and/or to be able to sell to fiat in emergency case.
- If you do not have enough time to do the vote yourself
- If you want to enjoy "the eighth wonder of the world" - auto-compounding
Then wrappers and optimizers are there for you.
$cpVARA is one of the solutions.
There are some reasons:
- Protocols with vote-escrowed model normally see wrappers as the exist liquidity for their vote-escrowed tokens.
- All the wrappers and their investors are facing some main difficulties: Losing its peg for the peg model or Drained out its reserve for the reserve model
$cpVARA is built to solve it and bring a win-win-win relationship to investors, vote-escrowed protocols and Champion
- For investors: with overcollateralized model based on burning mechanism, $cpVARA can maintain a sustainable & high peg value & APR, high ratio of $veVARA backed.
- For vote-escrowed protocols: Bring constant buy pressure on dex rewards token and with the overcollateralized model, $cpVARA help to permanently remove certain quantity of $VARA tokens from circulating supply.
- For Champion: Treasury will generate permanent voting power, maintain a long-term revenue.
$cpVARA is not the perfect solution, as it can be lost peg and user need to form liquidity in order to take advantage on farming APR.
Last modified 5mo ago