First, we would like to thank every holder, supporter, and contributor to Auric Network, and we appreciate the amazing support that you have shown us and will continue to build as we have over the last few months.
Before we list off the bulk of our updates, we would like to address the immediate concern that was brought to our attention by the community.
Staking Pool Adjustment
Today the community flagged the sudden decrease of staking rewards proportionate to before today’s rebase (about 1/6th according to our math).
At 2:26 AM Wednesday UTC, we received the first reports of the staking pool rewards being a bit off from before. Theoretically speaking, upon a positive rebase, Staking Pool V2 receives 10% of the rebasing amount as an injection for additional rewards–meaning that this should increase the number of tokens that users can earn. But instead, the opposite was happening.
Myself (Ichiro) and 2 other devs from the team along w/ 1 external party immediately started to look for the cause in case there were any vulnerabilities that could jeopardize the trust we had built with our holders. We dropped everything we were doing and fully focused on the issue to make sure that there were no economic exploits or logic that could hurt the token holder’s allocation.
To start, we found no vulnerabilities to the logic, and it is working as it was initially designed to. But, we did determine some necessary adjustments. Before going into more depth, I want to share more details about the staking pool.
Staking Pool Origin
The staking pool’s original design is a fork from Synthetix staking contracts. The logic is virtually the same. The three parameters would be as follows:
- Distribution Period
- Total Distribution Amount
- Ratio vs Uni V2 LP
For a rebasing token, these parameters realistically mean close to nothing. There were a lot of tweaks to the logic to create a pool fueled by the rebaser and complies with the logic of Uniswap V2 LP. This pool not only had to have a conditional expiry period but a distribution amount that changes daily, which would account for the ratio of LP staked as well.
The Staking Rewards Pool V2 has 2 functions intended as game-theory scenarios.
- It is to incentivize users to continue to provide liquidity like any other staking pool. This is just like any other staking pool on any other DEX, be it Uniswap, Pancake, etc…
- It is used as a balancing act (this is the part that is unique), kind of like the function of YAM which takes 10% of the rebase amount and swaps it for yUSD as a treasury to support token price in the event of a “death-spiral.” This was a result of what we viewed as the single biggest flaw with a non-dilutive rebasing token. Take AMPL for example: we saw it grow from less than $10,000,000 Market cap to $700,000,000 market cap in just 32 days.
But the moment that the momentum stops or buy pressure started to stop, people started selling. This is actually because people are so used to trading on price alone, which is precisely how you lose money trading a rebasing token. As people started selling from the top, it started debasing. Debasing + price dropping is the perfect formula in game-theory for causing FUD. Imagine that you lost 50% in a day but it starts debasing, so not only does the value of the token decrease but your supply starts shrinking too. YAM tried to combat this using a treasury, which requires governance and community involvement to try and mitigate for sell pressure. But, this also didn’t really help. So we came up with our own solution. We would create the incentive to create a support system for when we hit the initial max buying power.
Basically, as long as there is a positive rebase, the staking pool gets a fresh injection of tokens. What this means is simple.
During a positive rebase, people are inclined to stake to earn both the rebase and additional staking rewards on top of their rebase. When there is a correction in price or a big sell-off, people will be inclined to also do the same in fear and uncertainty. Meaning that they would have to unstake to sell their tokens. When someone unstakes, it naturally increases the APY of the pool since there are less people staking. Meaning that at a certain point the APY will be above 900%. This means that even if there is a huge drop in price, let’s say at 50~80% (not very likely but for the sake of this explanation), that if the APY is high enough it would be mathematically a better position for them to hold their positions or even possibly buy more to take up more of the staking pool. In this way, it becomes an automated balancing system with the purpose to provide price support at a higher place than the previous support every time there is a giant dip. I like to call it the “everlasting gobstopper,” but we decided to call it the “Gold Rush V2” for obvious trademark issues.
This was all a completely new logic that is experimental… but it worked.
Over the last 3 months, we have seen levels of price support and expansion at a steady price, regardless of the movement of the general crypto market.
Here are some more details…
Staking Pool V2
The Auric Staking Pool V2 has the following parameters:
- 14 day distribution period for distribution of total amount in the pool.
- 20% of ALL rewards claimed by LPs are collected as a sort of tax then reinjected into 4 pools:
- Governance Pool (controlled by community governance)
- Auric Dao Fund (controlled by community governance)
- Dev Pool
- Reinjected into the Staking Pool V2
3. 10% of all positive rebases are taxed and then reinjected into the Staking Pool V2.
4. Most important detail. The distribution time is reset every 14 days if any new injection or tokens is added to the rewarder for the pool. What this means is that over the 14-day distribution period, the staking rewards increases exponentially on day 14 vs day 1. This was never a problem because the rebase was not a crazy percentage like it is now.
We had originally intended for the staking pool to implement a different logic that uses not a concrete number but a ratio variable from the rebase. However, due to the fact that this was completely untested and something that has never been implemented by anyone else (that we know of), a staking pool that accommodates to rebases with the counter resetting daily instead of every 14 days, we implemented the safer version until we felt it was ready to implement.
Well, with the staking pool growing and interest in the project skyrocketing, we feel that now is the time.
Staking Pool V3
Staking Pool V3 will be released within the following days with the updated dashboard and governance UI. This is not an extra pool being added but is intended as a replacement to the V2 pool. We will be leaving a 24-hour window to unstake and migrate your UNI V2 LP to the new pool.
The logic for the new pool will be updated to reset the timer every rebase instead of every 14 days, making it possible for the rewards to not vary on a daily basis in exponential scale. Users will have 24 hours to remove the liquidity staked in the V2 pool before the V2 pool is discontinued and removed from the existing pools page of the app. After this 24 hour period users will have to manually remove their staked LP via the Ethereum blockchain themselves as the option will not be available on the site moving forward.
The staking pool V2 has seen significant interest and growth within the marketplace. While watching $AUSCMs outperform ETH/BTC and most of the rest of the market over the last week, we are even more excited for the growth of the Auric Network ecosystem. Thank you for the love and support.
Very soon we will be announcing our next plans and expected milestones which include our cross-chain bridges to other Ethereum sidechains. This will in turn make Auric Network the FIRST and ONLY hyper-liquid money that rebases across multiple blockchains. This is just a teaser, stay tuned…
About Auric Network
Auric Network (AUSCM) is a synthetic commodity money that is not dependent on the current world-based currency as the goal price or value. Instead, Auric relies on the centuries-old currency of all currencies, or store-of-value: gold.
Disclaimer: AUSCM is not an investment product. It is not intended in its design or distribution to be utilized as a form of investment, speculation, or a financial product. No communications from Auric Network Limited to users constitute financial advice, a solicitation for investment, or a guarantee of a financial return. Please do your own research and investigation before participating in this project.