Extension of HBAR Mining Incentives on SaucerSwap
SaucerSwap, as part of its real yield initiative, will be extending its HBAR emission runway indefinitely. This means that the farm contract will continue to emit both SAUCE and HBAR, despite the initial HBAR Foundation grant coming to an end. It’s important to note that SaucerSwap has received the entire 20 million HBAR from the Foundation as all TVL milestones were achieved per the terms of the grant.
The initial grant was structured as follows:
- 10M HBAR over the first two months
- 6M HBAR over the second two months if TVL > $5M
- 4M HBAR over the final two months if TVL > $15M
To achieve this continued yield, 20% of HBAR native staking rewards have been redirected from daocut to the farm contract. Assuming the current WHBAR balance of ~140 million and a 6.5% proof-of-stake APR, this amounts to 1.82 million HBAR per year distributed as liquidity mining incentives to farmers. The rewards sent to mothership.sol remain unchanged, therefore this will have zero negative impact on the single-sided staking APR.
The contribution of HBAR to the farm base APR will continue to be outweighed by SAUCE, however these incentives will increase as a function of TVL (WHBAR balance) and price. Since proof-of-stake rewards are derived from Hedera network fees, HBAR emitted to SaucerSwap farmers is considered real yield (i.e., not inflation-driven or subsidized via a grant), so is both sustainable and predictable.
The tokenomics will be reassessed once the DAO is phased in, at which point it may make sense to reallocate a portion of these HBAR native staking rewards to daocut. For now, the DAO treasury will continue receiving SAUCE from protocol buybacks and as specified in the release schedule. Furthermore, the SaucerSwap team will continue exploring ways to enhance yields, such as through a concentrated liquidity market maker (CLMM) protocol, which is currently under development.
