acVault Migration Explained

This article explains the migration process from acVault to acBTC Vault.

Key objectives for acVault migration:

1. Enable renCRV LPs to efficiently transition from Big Blind Pool to HODLER Pool without sacrificing potential yields and bearing unnecessary transaction costs.
2. A seamless launch of acBTC Vault and yield generating strategies.
3. Effectively bootstrap acBTC liquidity to support the launch of the acSwap application.

Pre-Migration Phase

The Big Blind pool is deployed as acVault, which is essentially a renCRV vault prior to migration. renCRV is the LP token for Curve’s Ren pool.

When a user stakes renCRV into the Big Blind pool, the acVault will automatically earn yields via the following steps:

1. Deposits renCRV into Curve.fi’s liquidity gauge;
2. Mints CRV tokens from Curve.fi’s minter;
3. Swaps CRV into wETH, and then swaps wETH into wBTC via Uniswap;
4. Deposits wBTC into Curve’s Ren pool to earn additional renCRV.

Meanwhile, acVault users will receive AC tokens as rewards in proportion to their shares in the vault. The pre-migration phase will last for approximately 14 days, which means that vault users can enjoy dual-mining incentives in both renCRV and AC for 2 weeks.

Migration Phase

acVault has a predefined parameter called migration due. Vault migration can be done only after the migration is due. Even though the due time can be updated by vault governance, we are going to use a 24-hour timelock to constrain such behaviors.

When vault migration is taking places, the migrator will do the following in a single transaction:

1. Extract WBTC and renBTC out of Curve’s Pool 5 using the deposited renCRV;
2. Deposit all WBTC and renBTC into acSwap;
3. Receive acBTC minted from acSwap.

Before the migration, acSwap must be in a paused state with no liquidity, which means no token is added to acSwap before and during the vault migration. After the migration, all renCRV are converted into acBTC, which turns acVault into an acBTC vault.

Post-Migration Phase

After vault migration is complete, the acVault is upgraded into acBTC vault which is effectively an acBTC yield generating protocol. Users can choose to withdraw their acBTC, or stay in acBTC vault to continue earning yield in acBTC and transaction fees generated from acSwap. This ensures that acBTC holders don’t lose any profit when compared to being an LP in Curve.fi.

Earning transaction fees via acSwap is only the first step to gain yields for acBTC holders. When acBTC is integrated into more DeFi applications, we will update the vault strategy accordingly to achieve more competitive yields.

For more information on the acBTC framework, please refer to our documentation: https://docs.acbtc.fi

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