Wombex Finance

<blockquote>Boost not only your LP APRs but also bribing knowledge</blockquote>Dear Wombex Warriors!The recent days were a very important ones for Wombex. The huge milestone was achieved with the launch of Wombex Bribe market. Hundreds of Wombex Warrors already participated in the first bribing epoch.We prepared this article to help our community make a deep dive into Wombex Bribe market mechanics and upgrade the level of understanding Wombat bribes in general.Part 1: understanding Wombat Voting &amp; bribes mechanicsIt is essential to start an explanation of Bribes from the beginning (from the voting mechanics itself). Due to this, in this section, we provide a comprehensive overview of Wombat Gauge voting and bribing mechanics to lay a solid foundation for discussing Wombex Bribes mechanics after that.<h3 id="strong-introduction-to-wombat-gauge-voting-strong">Introduction to Wombat gauge voting </h3>The Wombat gauge voting mechanism allows veWOM holders to decide how WOM rewards will be distributed to liquidity pools in the next epoch with 7 days duration.<blockquote>During the epoch, Wombex liquidity pools accumulate WOM rewards with a ratio proportional to the amount of votes allocated to each pool.</blockquote>When the epoch ends, WOM is distributed to liquidity providers in each pool linearly within the next 7 days.Wombat has a monthly scheduled emission of 2,000,000 tokens ( roughly 0.77 tokens per second). It is distributed between base allocation (75%, or 1,500,000 tokens per month) and vote allocation (25%, or 500,000 tokens per month).<ul><li>Base allocation (defined by the Wombat team) is distributed unconditionally to the base pools (such as BUSD/USDT/USDC/DAI pool) and doesn’t depend on veWOM holders votes. It is a regular LP incentive mechanism.</li><li>Each pool has its own allocation points, for example, 220 points (out of 1000 total) for the main BUSD pool, meaning that 22% of total Base Allocation goes to the BSUD pool (2,000,000 * 75% * 22% &#61; 330,000 WOM per month).</li><li>Vote allocation is distributed to remaining pools (including side pools/innovation pools/WOM liquid staking derivatives pools) according to the votes distribution during the previous voting epoch. One veWOM vote casted users equals the one vote to the pool.</li></ul><h3 id="strong-wombat-voting-mechanics-strong">Wombat voting mechanics </h3>The core contract in Wombat gauge voting is the Voter contract. This contract is responsible for accounting users’ votes and subsequent WOM distribution to the pools based on the voting results. It contains the following variables:<ul><li>Sum of all users votes (totalWeight)</li><li>Info about each pool:</li><li>Each users’ votes</li><li>Sum of all votes for the pool (weight)</li><li>Allocation points</li><li>supplyBaseIndex // the last WOM per allocation point distributed</li><li>supplyVoteIndex // the last WOM per vote distributed</li><li>baseAllocation // (1000 &#61; 100%)</li><li>totalAllocationPoints // sum of all pools’ allocation points</li><li>Amount of WOM distributed by base allocation</li><li>Amount of WOM distributed by vote allocation</li></ul>To vote, user calls the voter.vote(_lpTokens, _deltas) method and provides addresses of lp tokens of pools to vote for, and deltas — amount of veWOM to add or remove from a vote.Firstly, the voter contract checks out how many WOM has been distributed to the both categories (base allocation and vote allocation) already. It calls _distributeWOM(), which in turn calls _getBaseIndex() and _getVoteIndex() to update the distributed WOM according to the following rule:baseIndex &#61; baseIndex &#43; secondsElapsed * womPerSec * 75% / totalAllocationPoints;voteIndex &#61; voteIndex &#43; secondsElapsed * womPerSec * 25% / totalWeightWhere secondsElapsed is the time (in seconds) passed from the previous distribution.<ul><li>baseIndex basically defines how many WOM is accumulated per allocation point by the current time and is not dependent on votes.</li><li>voteIndex defines how many WOM is accumulated per one vote by the current time.</li></ul>After that (for each lpToken address provided by the user in the initial call) information about the corresponding pool is updated through the _updateFor(_lpToken) function. It recalculates the claimable rewards for the given pool according to the new baseIndex and voteIndex:baseShare &#61; (baseIndex — previousBaseIndex_p) * allocPoints_pvoteShare &#61; (voteIndex — previousVoteIndex_p) * weight_pclaimable &#61; claimable &#43; baseShare &#43; voteShareHere underscore_p denotes the parameters of the pool.The illustration of this process is presented below:<img src="https://miro.medium.com/max/1400/0*Q6p0CWXbT3Ga4BEM" />Pic 1. WOM distribution scheme.Then the voter contract calculates the changes in the weights of each pool by adding (if _deltas[lpToken] is &gt; 0) or subtracting (_deltas[lpToken] &lt; 0) from the pool’s votes, and tracks the total amount of votes for all pools by adding sum(_deltas). It also updates per-pool-per-user information (to track how many votes the user provided to a certain pool).The scheme is presented below:<img src="https://miro.medium.com/max/1400/0*UJKzz9X9YH77MHpu" />Pic 2. Voting scheme in Wombat<blockquote>Note, that voting in Wombat is continuous.</blockquote>It means that while the voting is active, each pool in the gauge accumulates WOM rewards that will be distributed after the voting epoch ends. It happens block-by-block: while votes are cast for the pool, WOM is added to the future pool rewards. But, if some votes are re-allocated to another pool, another pool will earn more starting from the block of votes re-staking.So, it doesn’t matter which gauge weight the pool has at the end of the voting, it is essential which gauge weight was average during the whole voting period:<img src="https://miro.medium.com/max/1400/0*6L842lukQoDHNhU9" />Pic 3. The picture above presents a schematic representation of a pool’s weight and WOM accumulation. One can see that when the vote weight of the pool increases, so does the rate at which WOM is accumulated in the pool. Afterward, the user unvotes (withdraws his previous vote) from the pool. The accumulation rate also drops proportionally to the change in the weight and the total number of votes.<h3 id="strong-wombat-bribes-mechanics-strong">Wombat bribes mechanics</h3>From the very beginning Wombat was focused on implementation of its own bribing mechanics to simplify future interactions with bribes for users and veToken aggregators built on top of Wombat.It was done in a way that protocols can supply bribe allocations promoting users voting for their pools. Voting for the bribed pool user earns a bribing reward continuously (remember, since WOM rewards are acquired to the pool block-by-block, bribe rewards follow the same mechanics; paying for each user’s vote cast for the pool every block). The reward distribution is identical to regular LP distribution mechanism: the contract Bribes, which inherits from MultiRewarderPerSec, stores the amount of rewardToken assigned to the pool and the tokenPerSec parameter, which defines how many rewardToken is distributed per second. Each user receives the rewardToken according to their share of votes for the bribed pool.Every time a voter.vote() is called, after all weight updates for a given lpToken, a Bribe.onVote(_user, _userVote, _originalWeight) is called passing three arguments:<ul><li>user’s address</li><li>user’s final vote for the given pool</li><li>pool’s weight before update (before accounting for the user’s vote)</li></ul>This, in turn, calls MultiRewarderPerSec functions _updateReward(_originalWeight) and _onReward(_user, _userVote).The first calculates the reward per vote distributed by the time of the call:accTokenPerShare &#61; accTokenPerShare &#43; timeElapsed * tokenPerSec / _originalWeightdistributedAmount &#61; distributedAmount &#43; timeElapsed * tokenPerSecAnd updates the lastRewardTimestep accordingly. In other words, it calculates for the given pool, how many bribe tokens per single vote should be distributed by the time of the call.The second calculates how many bribe tokens should be transferred to the user given his vote before the update:reward &#61; user.amount * accTokenPerShare — rewardDebtuser.amount &#61; _userVoterewardDebt &#61; user.amount * accTokenPerShare<img src="https://miro.medium.com/max/1400/0*moy_i5kvlqJU38Ip" />Pic 4. Wombat bribes payout scheme.Finally, reward tokens are transferred to the user.Part 2: understanding Wombex bribe market mechanics<h3 id="strong-wombex-bribe-market-general-concepts-strong">Wombex Bribe market general concepts </h3>Wombex native token (WMX) being vote-locked (vlWMX) allows voting in Wombat using protocol-owned veWOM voting power. Each vlWMX holder owns some share of total veWOM stake, and when voting occurs vlWMX votes should be translated to veWOM votes.Note: vlWMX is recalculated to veWOM proportionally to amount of vlWMX voted (sum_vlWMX/total_veWOM_owned_by_Wombex)An intermediary Wombex GaugeVoting contract will be responsible for the vlWMX-&gt;veWOM re-calculation and voting execution.In order to track users’ votes, a special BribesRewardPool (addresses are listed in the documentation: <a href="https://docs.wombex.finance/deployed-addresses" rel="noopener noreferrer nofollow">https://docs.wombex.finance/deployed-addresses</a>) is created for every Wombat LP.Wombex user with vlWMX calls GaugeVoting.vote(_lpTokens, _deltas) passing the lpToken addresses of the pools they wish to vote for, and corresponding deltas.<img src="https://miro.medium.com/max/1400/0*ucQnZkSIKQGZl7Je" />Pic 5. Wombex voting scheme.For every lpToken the user votes for, a “Staking token” is minted and staked if the delta is positive (or unstaked and burned, if the delta is negative — withdrawing the user’s previous vote) in a corresponding reward pool. This design stores all information about users’ votes in the reward pools as the reward token stake.<blockquote>Once the number of total vlWMX votes exceeds a threshold of 500,000, the translation of vlWMX votes into veWOM votes starts.</blockquote>The period of translation is set to 24 hours. During this time, vlWMX votes are accumulated in the Gauge Voting contract. When the voting is ready, an external agent (Keeper) calls the voteExecute function to translate vlWMX votes into veWOM votes and pass them to Wombat.The contract receives the total amount of vlWMX used for voting (by summation of all reward tokens in all reward pools), and the total amount of veWOM available for voting. We kindly remind here that the voterProxy contract holds all Wombex veWOM.To cast votes from vlWMX to veWOM, the contract has to recalculate the ratio of veWOM to vlWMX and obtain new voting power (that is, how many veWOM are used in voting per 1 vlWMX).ratio &#61; [veWOM balance on VoterProxy]/[vlWMX_voted]Where vlWMX_voted is the number of vlWMX participated in voting in the current epochThis ratio is used to calculate new deltas in veWOM. The contract takes the current vote (in veWOM) for the pool p and deduces the new delta for this pool:delta_p &#61; ratio * vlWMX_votes_for_pool_p — current_veWOM_votes_for_pool_pvlWMX_votes_for_pool_p is a number of votes cast for the pool p; it is equal to the Staking token balance in the BribesRewardPoolAnd calls booster.voteExecute(_lpTokens, _deltas) to finally vote in Wombat on behalf of Wombex.The Wombex Bribe market contracts scheme is presented below:<img src="https://miro.medium.com/max/1400/0*E9RES8McoLFY_JoE" />Pic 6. Schematic representation of voting mechanism through Wombex. The user calls Gauge Voting to provide their votes in vlWMX. Gauge Voting checks the user’s available balance through WMX Locker to prevent overspending, then mints or burns reward tokens in corresponding reward pools. When voteExecute is triggered, Gauge Voting calculates the translation of votes (deltas) from vlWMX to veWOM and the call is passed to Booster and Voter Proxy. The latter is the owner of veWOM votes in Wombat.The 24hrs period of vlWMX-&gt;veWOM re-calculation and voting execution can be changed, for example to execute a translation updating all veWOM votes every time a random user votes with vlWMX tokens. Current configuration can be seen <a href="https://bscscan.com/address/0x01F5cf0ddf7654714DA2a8D712Ce55687aC6057c#readContract" rel="noopener noreferrer nofollow">on bscscan</a>.<img src="https://miro.medium.com/max/442/0*kGM9QMmjuTPnh3gv" /><img src="https://miro.medium.com/max/394/0*fw9ZPOc9mk_Ufalq" />Pic 7. Wombex smart contract functions.The 24hrs period can be changed to any other one or set to zero. Currently, there is an execution incentive — 0.5% of bribe value paid to the executor of the transaction in order to motivate independend executors to participate in bribes distribution process.Also, users can take part (if this function is enabled, currently — no) in executing bribe rewards claims by executing it during voting tx or claiming rewards tx. However, it will require users to pay higher gas fees that can be unacceptable for little vlWMX positions.The process of claiming and distributing the Bribe rewardsWombex claims bribe income once per day and distributes it to vlWMX voters. These bribes proceeds are allocated to the corresponding reward pools (can be find at <a href="https://docs.wombex.finance/deployed-addresses" rel="noopener noreferrer nofollow">https://docs.wombex.finance/deployed-addresses</a>) and linearly distributed during the following 24 hours to vlWMX voters. Note, that every vlWMX vote is represented in the form of a Staking token in the Bribes Reward pools. The bribe reward distribution is similar to the distribution of LP incentives to liquidity providers.<img src="https://miro.medium.com/max/1400/0*0InNUQWhsTC9nESZ" />Pic 8. The picture above demonstrates the process of claiming bribing rewards from Wombat and distributing them to vlWMX voters thereafter. Every line going to zero represents a process of linear rewards distribution. Users can claim their rewards at any time.Note, that the picture demonstrates only current mechanics. The bribe claiming mechanics can be easily changed — it is possible to change vlWMX-&gt;veWOM re-calculation and voting execution period as well as bribing claim &amp; distribution period. We will analyze on-chain data from the last bribing epoch and set up the optimal parameters.<h3 id="strong-follow-wombex-socials-strong">Follow Wombex Socials </h3> <a href="https://twitter.com/WombexFinance" rel="noopener noreferrer nofollow">Twitter</a> | <a href="https://discord.gg/wombex" rel="noopener noreferrer nofollow">Discord</a> | <a href="https://t.me/wombex" rel="noopener noreferrer nofollow">Telegram</a> | <a href="https://coinmarketcap.com/community/profile/WombexFinance" rel="noopener noreferrer nofollow">CMC Community</a> | <a href="https://medium.com/wombex" rel="noopener noreferrer nofollow">Medium</a>

A deep dive into the Wombex bribe market

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Wombex Finance

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