PGP-16 : PAL x APW token swap

Summary:

Expand the partnership between Paladin and APWine with a token swap used to increase the synergies between both protocols.

Context:

APWine and Paladin partnership goes back to the first winelisting, as The palStkAAVE has been live since the launch of the protocol.

APWine is a yield tokenizing protocol, that is interesting for different types of users:

  • Traders can sell their yield in advance or buy yield, so basically long/short APRs
  • Arbitragers can use the fixed rate feature to secure profits by doing arbitrages on the AMM pools
  • Liquidity providers / farmers can add liquidity in the two types of AMM pools : PT/Underlying & PT/FYT.

The protocol works with a two token mechanism, PT (Principal token), which represents your deposit over the period, and FYT (Future yield token) which represents the generated yield over the 90 days period.

The governance token is the APW, which has a ve-model tokenomics similar to curve voting escrow. The veAPW has a lock capability from 1 week to 2 years, granting users a proposal power, a gauge power and soon, a yield for veAPW holders.

3 months ago, the DAO enabled gauges, which allows veAPW holders to redirect the reward emission on their favorite pools.

PalstkAAVE/stkAAVE pools current state :

  • PT/stkAAVE => $543k TVL ; 27.2% APY => need around 100k veAPW to get 30% APY
  • PT/FYT => $14.5 k TVL ; 44% APY => need around 57k veAPW to get 100% APY

A few months later, a proposal was submitted to add an extra liquidity mining in PAL, as mentioned in this vote:

https://snapshot.org/#/palvote.eth/proposal/0x26d4edc214380dc8843e45d041398900d8239814d3f101fccc4e7e9099751180

A token swap has been mentioned several times, especially on Paladin Forum on April 14th and again on May 1st:

Rationale:

The goal of this proposal is to swap 160000 APW for the equivalent in PAL for both projects to lock and acquire voting power. The swap will happen over a month after the end of the vote, with a 1 week TWAP price for the 4 tranches, which aims to attenuate the market volatility in the past weeks. This proposal implies long term perspectives & $PAL liquidity mining removal.

The prices will be calculated from early July to early August.

Since Paladin requires a precise amount of APW, the swap happen as follow :

Week 1 : 40000 APW = x PAL ((40K APW *TWAP price APW Week 1) / TWAP price PAL week 1) = x PAL

Week 2 : 40000 APW = x PAL

…

Week 4 : 40000 APW = x PAL

Benefits for Apwine DAO:

  • Create a long term position on PAL
  • Stake & Lock PAL to participate on the governance
  • Once defined, enjoy chest rights
  • Once possible, APWine will create a proposal to integrate Quest
  • New Paladin IBTs that can be integrated on the protocol (palTokens such as palhPal)
  • Increase the visibility of both projects with cross marketing

Benefits for Paladin DAO:

  • Create a long term position on APW
  • Ability to vote on APW gauges with veAPW
  • Increase the yield for palStkAave pools users
  • Increase the governance participation and DAO voting power by accumulating APW rewards (if accepted on the upcoming
  • palTokens can be integrated as IBTs on APWine
  • Increase the visibility of both projects with cross marketing

Means:

  • 160000 APW for the token swap

Technical implementation:

  • Paladin Community Gnosis Safe should be able to lock the veAPW
  • Calculate the TWAP price and make the swaps each week

Voting options:

  • Yes
  • No
  • Abstain

0 voters

Co written by @Dydymoon

4 Likes

This proposal has my full support.
We still need to find the write structure to manage vote locked tokens, but I think entering the APWars will be an extremely good study case for us, as well as a great opportunity to reduce emissions while maintaining high APR in our APWine pools.

Looking forward to this.

3 Likes

LFG :fire:
So hyped about Paladin entering the APWars :eyes:

I guess it should be easy as long as there is only one Paladin IBT, because we would only have to decide the vote split once between PT/Underlying and PT/FYT, as the votes are saved for next weeks if unchanged.
However this might become more complicated once we add other assets such as palhPal, as locked hPal holders might have different ideas on the split.

2 Likes