Forex yield farming with KyberDAO on Polygon
We are happy to unveil our new yield farming program on Polygon, in partnership with KyberDAO.
This program will reward users with $440k worth of JRT, UMA and KNC, wrapped into the AUREUS token.
Its goal is to bootstrap the liquidity of a secondary market for our jFIATs. Even though users can trade jFIATs without price impact on Jarvis Exchange, a second source of liquidity is needed to facilitate some use cases, like a liquidity dry-out on our protocol, some low-risk trading features as described in our Manifesto, or for allowing LPs to exit their positions.
Please before participating in the program, read the RISKS at the end of this article.
We invite you to join our live event tomorrow the 7th of October at 3pm GMT! We will explain how to participate, what are the risks, yields, and strategies.
TLDR:
- To participate, visit our Yield app or kyberDMM.
- The program consists of depositing jFIATs and USDC on concentrated liquidity pools on KyberDMM; jEUR-USDC, jGBP-USDC, jCHF-USDC, and AUR-USDC are incentivized.
- The program starts on the 6th of October, around 15:55 GMT at block 19910900, and ends in 2.1M blocks, the 1st of December (estimated dates are not precise, therefore, the blocks can be minted earlier or later than initially estimated).
- The 100 AUREUS tokens (ticker AUR-0112, hereafter “AUR”) are backed by 3,376,520 JRT and 10,309 UMA provided by the Jarvis’ treasury, and 85,400 KNC provided by the KyberDAO’s DAO; these tokens are held in the Reserve contract; therefore, each AUR token is backed by 1% of the Reserve contract’s holdings.
- Participants receive AUR, which can be sold immediately on KyberDMM or kept to be redeemed for a share of the Reserve contract after its expiry, the 1st of December.
- 98 AUR will be distributed, 2 AUR have been used to seed the AUR-USDC liquidity pool on KyberDMM
How to participate?
You can follow this step-by-step tutorial to participate in the program or ask questions in our Discord.
To participate in the yield program, you will need to provide liquidity in the KyberDMM’s eligible pools and stake the corresponding LP tokens.
You can do these two actions either on the Jarvis Yield app or KyberDMM.
For information, here is the list of eligible pools:
KyberDMM
KyberDMM is KyberDAO’s AMM with dynamic fees and concentrated liquidity. Its design is perfect for low-volatility assets like our stablecoins.
AUREUS token
By participating in our program, you will be rewarded with AUR and with trading fees. AUR needs to be harvested, trading fees will simply accumulate in your pool.
100 AUR have been minted and 98 will be distributed as follows:
- jEUR-USDC: 44 AUR
- jGBP-USDC: 17 AUR
- jCHF-USDC: 26 AUR
- AUR-USDC: 11 AUR
What is the Aureus token?
The Aureus token is designed to content short-term and long-term farmers, as well as the projects’ token holders. It is a future contract with some interesting trading mechanisms described below.
Reserve
AUR is backed by a basket of other tokens held in the Reserve contract. For this program, it is backed by $450k worth of token (at today’s price):
- 3,376,520 JRT
- 10,309 UMA
- 85,400 KNC
Sell or keep AUR?
AUR is listed on KyberDMM as well and the AUR-USDC pool is incentivized as well. This way, a short-term farmer can sell their AUR right away, while the long-term farmer can keep their AUR and exchange them at their expiry to redeem a part of the Reserve contract.
At their expiry, the 1st of December, each 1 AUR token can be burnt to redeem 1% of the Reserve contract.
Ex: if you have 2.1 AUR on the 1st of December, and the Reseve holds $500k of JRT, UMA and KNC, then you will be able to burn your AUR and redeem the JRT, UMA and KNC worth 2.1% of $500k.
Because farmers can sell AUR, it won’t cause selling pressure on the underlying JRT, UMA, and KNC tokens for the duration of the program.
Trading mechanisms
The AUR token is a JRT-UMA-KNC futures contract that expires in 2 months. Market participants will buy and sell AUR by anticipating what will be the value of the tokens in the Reserve contract at the expiry. Short-term farmers will sell, creating arbitrage opportunities for long-term farmers or traders, who will reequilibrate the price.
For ex, if farmers are selling, the price of AUR could be way below the value locked in the Reserve contract; this could incentivize traders to buy AUR, thus receiving discounted JRT, UMA and KNC at the expiry.
Risks
Participating in this program carries various risks:
- Market risks: you will be providing liquidity for two assets, whose value can change over time, thus creating either a loss or a profit; you will be receiving rewards that can be illiquid, and which value may not offset potential losses you may suffer from; the value of the rewards can change quite rapidly over time as well.
- Technical risks: you will be interacting with smart contracts, which despite being audited and tested, can still carry mistakes that can be exploited, leading to the partial or total loss of your funds.
- Liquidity provision risks: in addition to the market risks, you will face impermanent losses risks; you will be providing liquidity on concentrated liquidity pools; these pools design to decrease slippage but augments the impermanent loss; each pool has a low and high price limit, which, if touched, will occur a maximum impermanent loss of %; for example, if EURUSD price goes to 1.43153, you will only have USDC left, whose value would have decreased; you would have sold all your jEUR at lower prices.
We invite everyone to join our Discord and engage with the community to discuss the trading of the Aureus tokens.
Pascal (pascal.jarvis.eth on Twitter).
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⛔ Risk Warning: Investing in digital financial assets involves a high degree of risk and volatility and is not suitable for all investors; do not risk more money than you can afford to lose. Please consult an independent professional financial or legal advisor to make sure the product is right for you.
⛔ Disclaimer: This article contains text, data, graphics, photographs, illustrations and information (“Information”) connected with Jarvis International and/or other entities part of the Jarvis group ( “Jarvis”). Jarvis attempts to ensure Information is accurate, however, Information is provided “AS IS” and on an “AS AVAILABLE” basis and may not be accurate or up to date. The publication of this article does not represent solicitation by Jarvis of buying the token “Jarvis Reward Token” and is not to be considered as a recommendation by Jarvis as to the suitability of any investment, if any, herein described. No action should be taken or omitted to be taken in reliance upon Information in this document. Jarvis accepts no liability for the results of any action taken on the basis of the Information.
