Understanding Pools
Liquidity mining to earn our governance token GRO
Pools ares designed to let users stake and provide liquidity while earning governance token rewards. These pools can be largely divided into single-asset pools and 2-asset pools.
2-asset pools come with Impermanent Loss risks as arbitrage takes place when the pool exchange rate differs from other price oracles'. Impermanent Loss risk is higher if the two tokens do not go in the same directions, such as when the trading pairs consist of a stablecoin and a governance token. On the other hand, single-asset pools do not suffer from Impermanent Loss since there is no arbitrage in single asset pools.
as at 18th July 2022
If you hover your mouse around the tool tip (the circle with an "i" inside), you would be able to see the breakdown of the APY. It typically consists of GRO rewards and protocol returns or pool fees.
as at 18th July 2022
This refer to the Gro DAO tokens earned and available for claiming and vesting in Rewards Centre. The APY is determined by several factors:
- 1.GRO token price - higher token price leads to higher APY
- 2.TVL of the pool - higher pool TVL leads to lower APY
- 3.GRO per block allocated for pool rewards - you could check the exact number allocated in the LPTokenStaker contract (see GRO tokens). Once you're on Etherscan, you'd be able to see number of gro that is distributed to the pools by going to "Read Contract" -->
groPerBlock. - 4.Pool weights - each pool has a weight that determines the pool's share of the GRO per block. The weights could be read from
allocPointin each pool (weight = allocPoint/100).
Pool weights shift from time to time in order to continually decentralise the protocol's governance to users. As Vault users take on a more substantial impact if a yield strategy doesn't go well and that the DAO governance would determine which yield strategies to whitelist, current emission skews towards Vault users so they can vote for which strategies they'd whitelist (or de-whitelist) and other protocol parameters.
Over time the setting of these parameters will be decentralised with on-chain governance built to directly execute the vote outcome. GRO holders will then be able to directly determine the best way to incentivise protocol adoption and governance.
Got more questions? Or want to share your thoughts on the pool rewards? Head over to our Discord server!
For the most updated GRO per block and pool weights, please refer to this Dune query created by DAO contributors Slacking and Wint3rmute
Pool fees
It refers to the trading fees earned through providing liquidity to the pool; it is determined by the fee level charged and the pair's trading volume.
It would only appear if one of the assets are either PWRD or Vault, which come with their own protocol returns through our yield strategies; in a 2-asset pool, the protocol returns shown would be pro-rated by the asset's % of value in the pool - i.e. the protocol returns of GRO/Vault 50-50 pool is only half of what Vault earns because only 50% of the pool is formed by Gro Vault tokens.
You could stake and unstake any time without penalties. There are no restrictions to when you could unstake; if you choose to do so, your earned GRO rewards will not be affected - simply head to the Rewards Centre to start vesting.
DeFi is still a very new space, and while that's exciting, it comes with risk. Gro Protocol's software helps you access this world, but make sure you do your own research and only supply assets you can afford to lose.
Last modified 1yr ago