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xBi0 edited this page Jul 22, 2024 · 6 revisions

# WEWESwap Wiki

😎 WEWE love the yields

Concept

WAMMv1 redefines LP Positions as "working assets" that earn yield and maximize Impermanent Gains (IG) to gains in $USDC. Users should view LP Positions similarly to real-world assets (e.g., businesses), which may appreciate or depreciate.

Yield is accrued in USD stablecoins, perceived as "cash," ensuring users can realize yield in a stable asset.

Strategy

  • Deployment: Initially deployed on weweswap.com as WAMMv1.
  • CHAOS Points: Base.Univ3 positions will be migrated to WEWESwap to earn CHAOS points farming tokens.
  • Initial Pool: WEWE-USDC.
  • Future Expansion: Vampiring other DeFi protocols and meme coins.

Overview

WAMMv1 aims to achieve:

  • Simple UX: Easy for users to enter and exit.
  • Passive UX: No active management required.
  • Consistent Yield: Paid in stable "cash" (USD stablecoins).

Problems

UniV1/UniV2 AMM (CP)

  • Pros: Passive LP with exposure to IL.
  • Cons: Not capital-efficient. Yield accrued in two assets within the pool.

UniV3/UniV4 AMM (CLAMM)

  • Pros: Capital-efficient. Yield accrued outside the pool.
  • Cons: Increased UX complexity with price ranges, NFT Positions, and more. Requires:
    • Multiple assets for entry.
    • Understanding and selecting price ranges.
    • Re-balancing LPs as they can go out of range.
    • Yield in two tokens.
    • Excessive pool choices leading to decision paralysis.

Challenge: Create an AMM that caters to 100 million retail users with a simpler UX.

Solution

To address the challenges:

  • Easy Entry: Simplified with a single asset (ZAP).
  • Simple Pool Selection: Avoid decision paralysis.
  • Yield Management: Accrued outside the pools and paid in USDC.
  • Auto-Rebalancing: Ensures users are always in range without active management.

Pool Types and Fee Structures

Pools are paired with USDC, allowing rewards to be "zapped" back to USDC. The Zapper Aggregator selects pool types and price ranges based on asset type:

  • STABLE: {USDT}-USDC // ±1% range; 5bps
  • BLUE-CHIP: {WETH}-USDC // ±10% range; 30bps
  • SMALL-CAP: {WEWE}-USDC // ±50% range; 100bps

LP Ownership in Pool

  • Bands: Users add their working asset into a pool. The Liquidity Manager Contract distributes it into three bands (Narrow, Mid, Wide) of LP.
  • Ownership: Users receive ownership units of the total LP for the pool, tracking ownership of both principal and accrued yield.

Auto-Rebalancer Bot

  • Re-balancing Rules:

    • Band must be out of range.
    • Band must be moved back in range.
    • Bot can charge up to 10bps for re-balancing.
    • Leftovers are retained in the LM contract and can be collected at the next re-balance.

  • Price Movement: If a band is out of range for over an hour, any bot can call the LM Contract to remove and rebalance the band, charging a fee and updating the band.

Liquidity Bands

Each pool has three bands with target price ranges:

  • StablePool - ±1%

    • Narrow: Lower 0.996, Upper 1.004
    • Mid: Lower 0.99, Upper 1.01
    • Wide: Lower 0.983, Upper 1.017

  • Blue-Chip - ±10%

    • Narrow: Lower 0.96, Upper 1.04
    • Mid: Lower 0.9, Upper 1.1
    • Wide: Lower 0.83, Upper 1.17

  • Small-Cap - ±50%

    • Narrow: Lower 0.8, Upper 1.2
    • Mid: Lower 0.5, Upper 1.5
    • Wide: Lower 0.3, Upper 1.7

Yield

  • Fee Management: All liquidity fees are paid back to the Liquidity Manager Contract and swapped to USDC. Users can claim their USDC yield at any time.
  • Fee Shares:
    • Fee0: USDC
    • Fee1: To be swapped regularly
    • consolidateFees(): Callable by anyone with a 5bps charge

Subsidies

  • CHAOS Points: Initial users earn CHAOS points, redeemable via the Liquidity Manager Contract. CHAOS points will be streamed with a decay function (half-life of 3 or 7 days).

Withdrawing

Users can withdraw their position anytime based on ownership units. Withdrawals are processed equally from all positions, swapped to one side if requested, and then withdrawn.

Tokenized Vault or Not?

Infra

  • Kyber Zap Aggregator: Zaps liquidity into WAMMv1 LM Contracts.
  • LM Contract: Handles unequal tokens and refunds leftovers.
  • Krystal ALM Bot: Re-balances liquidity using internal LM contract logic.
  • Uniswap V3: Fees swapped to USDC and deposited into LM Contract.

Frontend Interface

  • Migrate: Transition liquidity.
  • Pool: Manage pool assets.
  • Swap: Exchange tokens.
  • Earn: Track and claim yield.

WEWESwap (WAMMv1) is a super-simple passive AMM that combines Concentrated Liquidity, Auto-rebalancing, and a Liquidity Manager Contract. Users can "zap" in liquidity from any token, with yield accruing in USDC and claimable by users.

Join us! https://linktr.ee/weweonbase

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