Understanding 4Belt & beltTokens

Published in

Belt Finance

8 min readMay 6, 2021

This is a guide to understand the basics of the 4Belt BLP pool, the 4Belt token, and beltTokens (beltBTC, beltBNB, beltETH, etc.).

We’ll start with 4Belt.

The 4Belt BLP Pool is at its basis, a liquidity pool. Liquidity pools are pools of tokens that sit in smart contracts. For the 4Belt BLP Pool, the pool consists of BUSD, USDT, USDC, and DAI tokens. You can learn more about liquidity pools here.‌

4Belt consists of beltTokens (beltBUSD,beltUSDC,beltDAI,beltUSDT). beltTokens are the multiple strategy tokens that consist of beltSingleToken with beltStrategy for each protocol. We created this architecture for the scalability of the beltToken. This architecture makes it possible to add or upgrade the strategies for better APR to users. We also set up an idle ratio between strategies to handle larger volumes of assets and prepare for strategies that are temporarily pending.

We aim to make 4Belt the best option to keep your stablecoin position while getting the best reliable yield possible. Understanding 4Belt and beltTokens is straightforward. Simply, it is the base value of the token + increasing value from the yield when you hold the token. We are trying to make 4Belt and beltTokens independent assets that can trade and swap in other DEXs and other BSC DeFi protocols. We will work to make it so that holding 4Belt will be a default when users want to hold stablecoins, and beltBTC will be advantageous over just holding BTC.

Basically our 4Belt is created through stableswaps so it has some characteristics of that system. First, you can see the details for this pool and it is something you can take advantage of when depositing or withdrawing.

This screenshot is the breakdown of the 4Belt BLP Pool. DAI is low which means that you can deposit (“sell”) it for slightly more 4Belt tokens than others with a higher amount (e.g. BUSD). The idea behind this is that traders/depositors are incentivized to push the price back to keep a certain ratio.‌

What happens when you provide liquidity to the 4Belt Pool?‌

You have the option of deposit one or more stablecoins.‌

If you deposit one stablecoin, it goes to the strategy that is selected for the idle ratio. So if you deposit DAI, it would get send as one of DAI, USDC, USDT, or BUSD to the particular strategy. The values change constantly as people trade between different tokens and the ratio of the pool changes.‌

Does it matter which coin I deposit?‌

You can deposit one or all the coins into the pool without it affecting your returns. Your tokens will get split into the pool and this doesn’t affect the returns you get at all. However, there is a deposit bonus/penalty system in that affects the value of your initial principal deposit.‌

Deposit Bonuses

You can see above in screenshot A, that the ratio of DAI in the pool is relatively low. If your plan was to join the pool at that time, you would ideally deposit DAI into it. This would give you a slight “bonus” compared to other tokens with a higher ratio in the pool.‌

There are two main reasons for this:‌

One main reason is that the pool is always trying to balance itself out and go to equal parts (i.e. 25% of each token), so depositing the token with the lowest ratio will get you a deposit bonus.‌

Another reason is that stablecoins also have value fluctuations. If a certain token is slightly more expensive there is a bonus for that.‌

As you can see below, depositing 1000 DAI gives you slightly more 4BELT BLP than depositing 1000 BUSD. Pay attention to the number of 4BELT BLP received and the bonus.

Withdrawal Bonuses‌

When you withdraw, the same principle applies (but reversed). Withdrawing the stablecoin with the highest ratio gives you a bonus. You can, however, choose whatever stablecoin or combination of stablecoins you want to withdraw.‌

Calculating Bonuses

The bonus is calculated as such:

I=(((receivedtokenvalue)−(transferredtokenvalue))∗100)/(transferredtokenvalue)

Understanding 4Belt APR‌

For the 4Belt BLP pool, APR is calculated through a combination of the 4Belt APR(Base APR from multi-strategy yield from our strategy protocols), Trading Fee APR (this is a past 24 hour average), and BELT token rewards.

‌The breakdown can be seen at anytime by clicking the magnifying glass icon next to the 4Belt pool on the Belt Finance Website.‌

At the time of writing, the 4Belt BLP Rewards are as such:

As you can see in the screenshot, the Total APR is a combination of the aforementioned 4Belt APR, Trading Fee APR, and BELT APR.‌

As you get rewards for your deposit in the 4Belt Pool, the number of your tokens will not go up but the value of each 4Belt BLP token will go up with the 4Belt APR and Trading Fee APR.‌

The 4Belt APR is autocompounded to the value of your 4Belt BLP tokens every 6 hours.
The Trading Fee APR is autocompounded to the value of your 4Belt BLP tokens with each trading transaction.

BELT APR rewards are added in real time and can be seen in the “BELT EARNED” section separately. These can be harvested at anytime.‌

The Value of the 4Belt Token‌

The 4Belt token is represents the average of the underlying tokens (stablecoins) + the yield from our multi-strategy yield and trading fees thus far.‌

As more yield gets applied with the passing of more time and with more strategy protocols giving higher yield, the value of the 4Belt token will continuously increase as this yield is autocompounded every 6 hours.

Below is the equation we used to calculate 4Belt price:

TLDR: 1 4Belt token > 1 USD. The value will continuously rise as long as the underlying stablecoins (USDT, BUSD, USDC, DAI) retain their peg to the US dollar.‌

4Belt Earn Policy‌

A main function of Belt.fi is being a lending aggregator. Funds are automatically shifted between strategy protocols as interest rates change between these protocols. Belt.fi completely optimizes the interest accrual process for end-users to ensure they are always obtaining the highest interest rates among our connected platforms. Earns from each beltStrategy contract are automatically added and compounded to your deposit every 6 hours.‌

example transaction:

https://bscscan.com/tx/0x6e8389aef0451c2c3907930f591ab6c586debb5e4a46f17ac7dd9a457384b8d3

Understanding beltTokens (beltBTC, beltETH, beltBNB, etc.)

beltTokens refer to the belt tokens (beltBTC, beltETH, beltBNB, etc.) you receive upon depositing into a Belt Finance vault. beltTokens are in essence a deposit receipt. They represent liquidity provided in a Belt depositor contract. beltTokens are compounding vault tokens.‌

For example, if you deposit BTCB in Belt BTC Vault (Belt Depositor contract) you will receive beltBTC in return.‌

All beltToken vaults have multi-strategy yield applied to them. This idea behind this can be seen in the image above. Every token deposit into Belt Finance is not depositing wholly in a single strategy. Deposits are split between our different strategy protocols to optimize yield and security by spreading risk across the different protocols. Deposits are operated through the “Keepers” decided ratio, which you can see in the architecture.

When the depositor contract you are providing liquidity to generates yield, your beltTokens will increase in value, since they represent a share of that vault. This is why you will observe an increase in price. The base APR from the multi-strategy yield is automatically added and compounded every six hours to the value of the beltToken. This is separate from any BELT rewards.‌

Basically, each beltToken represents the underlying token + the yield from our multi-strategy yield thus far (e.g. beltBNB = BNB + base multi-strategy yield).‌

beltTokens are BEP-20 meaning they can be transferred and traded as any other BSC token (as of now we recommend that this takes places only through Belt Finance as other methods may be susceptible to scams). When you withdraw liquidity from the Belt Finance pools/vaults, your beltToken will be burned.‌

The beltToken automatically balances your stablecoin to the protocol(s) with better rates if there are any. This process is free and non-custodial.‌

beltToken Vaults

‌ Vaults are capital pools that automatically generate yield based on opportunities present in the market. Vaults benefit users by spreading gas costs, automating the yield generation and rebalancing processes, and automatically shifting capital as opportunities arise. End users also do not need to have proficient knowledge of DeFi or the underlying protocols involved, thus, Vaults represent a passive-investing strategy.

beltToken Earn Policy

‌A main function of Belt.fi is being a lending aggregator. Funds are automatically shifted between strategy protocols as interest rates change between these protocols. Belt.fi completely optimizes the interest accrual process for end-users to ensure they are always obtaining the highest interest rates among our connected platforms. Earns from each beltStrategy contract are automatically added and compounded to your deposit every 6 hours.‌

example transaction:

https://bscscan.com/tx/0x6e8389aef0451c2c3907930f591ab6c586debb5e4a46f17ac7dd9a457384b8d3‌

About beltToken Value

‌As written above, beltTokens represent the value of the underlying token (i.e. BTCB for beltBTC) + the yield from our multi-strategy yield thus far.‌

As more yield gets applied with the passing of more time and with more strategy protocols giving higher yield, the value of the beltTokens will continuously increase as this yield is autocompounded every 6 hours.‌

You can check the contract data of a beltToken (the underlying token swap ratio) through BSCSCAN Links and the parameter named “getPricePerFullShare()”

ex> beltBTC

https://bscscan.com/address/0x51bd63F240fB13870550423D208452cA87c44444#readProxyContract

TLDR: 1 beltToken > 1 underlying token’s value. (e.g. 1 beltBTC > 1 BTCB)

‌For example, If you deposit 0.0057 BTCB in this single BTCB vault. You would get about 0.005679849728068439 beltBTC, excluding the deposit fee of the target strategy.

All the contracts address we deployed can be seen here: ( https://docs.belt.fi/contracts/contract-deployed-info ) and all the contracts we deployed are verified on BSCSCAN.

Official Belt Finance Channels & Sites