Get more mWOM through the Smart WOM Converter
Magpie was recently launched on Arbitrum, a Layer 2 solution developed to scale the Ethereum network. This development extends the platform’s high APR and revenue-sharing opportunities to a wider user base within the Arbitrum ecosystem.
In this article we will explore how the newly released Smart WOM Converter plays a vital role in securing a fair conversion ratio for the mWOM to WOM price and maintaining a close price relationship between mWOM and WOM for Arbitrum users.
What is mWOM?
A notable feature of Magpie is mWOM, or Magpie WOM, which enables WOM holders to earn increased staking rewards and revenue sharing from the platform. WOM is the governance tokens of Wombat Exchange.
When Arbitrum users choose to convert their WOM tokens into mWOM or compound their WOM rewards on Magpie, they receive 1 mWOM for each WOM token at a 1:1 conversion ratio. However, the mWOM token is also listed on the Wombat Exchange, where its price may fluctuate in relation to the price of WOM. As a result, users may encounter different conversion rates when swapping WOM for mWOM on Wombat Exchange.
1. WOM to mWOM Conversion — before the Smart WOM Converter
On Magpie: Currently users receive a fixed rate of 1 mWOM for each WOM token converted.
2. WOM to mWOM Swap
On Wombat Exchange: If the mWOM price is lower than the WOM price, users have the potential to obtain a more favorable rate when swapping WOM for mWOM. For example, if the exchange rate is approximately 1 WOM = 1.13 mWOM, users would receive around 1.13 mWOM for each WOM token exchanged on the Wombat Exchange.
The Smart WOM Converter
To maintain a stable price relationship between WOM and mWOM on Arbitrum, Magpie has implemented the Smart WOM Converter feature. This system automatically evaluates the WOM to mWOM exchange rate on Wombat Exchange and offers users the most favorable conversion ratio directly from the mWOM pool.
Preserving a healthy price for mWOM on Arbitrum is fundamental. The Smart WOM Converter effectively tackles this issue by ensuring a just and competitive conversion rate from WOM to mWOM, consequently contributing to the stability of mWOM’s value. If the mWOM to WOM exchange rate is lower than 0.90 on Wombat, the Smart WOM Converter will convert WOM into mWOM for Arbitrum users, resulting in more than 1 mWOM received for each WOM converted. The converter provides a ratio that exceeds 1:1, offering users the best possible rate when they convert WOM to mWOM. Similarly, when users choose to compound their WOM rewards into mWOM, they will obtain an mWOM amount based on the Wombat Exchange swap rate between their WOM rewards and mWOM.
Magpie places significant emphasis on maintaining a close price relationship between mWOM and WOM for Arbitrum users. This feature aims to ensure a fair conversion ratio during the mWOM to WOM conversion process. The Smart Converter plays an important role in this by allowing users to secure more mWOM for their WOM at the most advantageous rate available.
About Magpie XYZ: Magpie XYZ is a multi-chain platform built to boost yields for liquidity providers and governance token holders of veTokenomics protocols. Essentially the platform incentivizes governance token holders and liquidity providers to pool their assets together so that the platform can acquire governance tokens, convert them into veTokens, boost yield for liquidity providers, and in return share part of the protocol revenues derived from liquidity providers’ boosted profits back to governance token holders.