OneRing: The Road to Real Yield
As TVL grows, you will stake $RING to earn stablecoins!
OneRing is proud to introduce its OneRing Performance Fee Distribution model. Now that the EVM dApp is operational and $USDC depositors are generating great yields on their stablecoin deposits, it is time to introduce the mechanics for the distribution the performance fees collected by the platform to the OneRing community. Let’s break down the OneRing Revenue Sharing Model.
What are performance fees?
When users deposit stablecoins into the OneRing vaults, the platform utilizes farming strategies across various protocols to earn fantastic yield for you. From these farming returns, the platform retains 20% of the APY for platform operations and growth as well as to capture the value of the platform for $RING stakers (which we get into momentarily).
Keep in mind that the 20% performance fee is deducted from the yield realized across all of OneRing’s farming strategies and not deducted from your initial deposit.
Where do the performance fees go?
The 20% performance fees retained by the platform are distributed across three cash flow streams with the prosperity of $RING stakers ALWAYS the most important consideration.
The first performance fee distribution stream is into the recently-introduced Multi-Chain Farm which receives 4% of platform yield (20% of performance fees). This treasury farming solution will employ low-to-medium risk strategies to earn yield across multiple blockchains and protocols. 100% of the yield accrued from this endeavor will be used to buy back and burn $RING on a monthly basis.
The second performance fee distribution stream is into strategic reserves which retains 6% of the platform’s yield (30% of performance fees). These strategic reserves are used for the operations and growth of the platform as well as to provide boosted yield to OneRing vault depositors. Strategic reserves are parked in OneRing vaults without staking and the money can be used for many current and future necessities such as an insurance fund, a marketing fund, to provide additional liquidity on new DEXs and CEXs, and future usages yet to be determined. Also, strategic reserves contribute to the platform’s TVL, provide additional yield, and increase performance fees to be distributed to the community!
Finally, and most importantly, the third platform fee distribution stream is collected by $RING stakers who capture 10% of the platform’s value (50% of performance fees). This fee distrbution will be in the form of stablecoin yield provided to you, the OneRing community!
The distribution of OneRing platform yield
OneRing Revenue Sharing Model
In the not-too-distant future, $RING stakers won’t be saying, “Show me the money”, they will be making the money through the OneRing Revenue Sharing model.
The revenue sharing model is based on many projections and variables, but the three key ingredients are OneRing vault total value locked (TVL), realized farming APR, and the number of $RING staked on the platform. Let us take a look at each variable one-by-one.
OneRing vault TVL
It goes without saying that the more stablecoins deposited into OneRing vaults, the more funds that will be utilized in farming strategies, and the more performance fees to be accrued by the platform that can be distributed to $RING stakers.
Realized farming APR
How much yield can stablecoin depositors expect to earn from OneRing farming strategies? It is a question that can only be answered by looking into the future of decentralized finance (DeFi). There are many scenarios that could play out, but we imagine a low-end scenario of 8% APR and an optimal scenario of 15% APR. Higher APR means higher performance fee accrual, which means more stablecoin yield for $RING stakers.
Amount of $RING staked
Fewer $RING staked means higher yield for those users that have staked. In other words, you can stake more $RING and yield a bigger piece of the (performance fee) pie. It is impossible to forecast how many $RING will be staked in the future, but for our analysis we assume 75% of the supply will be staked and earning yield for the community.
Note: The total supply of $RING will face deflationary pressure from the Multi-Chain Farm and will be burned until 80m $RING remain.
Revenue sharing model calculation example
As mentioned, there are many variables and projections at work that make a 100% accurate forecast near impossible. But, let’s try!
First, assume a $10m TVL, an average APR of 10%, and 75% of the $RING supply staked. Under this scenario, if you stake 10k $RING (current value: $127), you can expect to earn $167 in stablecoin yield for the year — a cool 131% return based on current prices. If you were to stake 100k $RING, your yield would grow to $1,670 for the year!
Let us now assume that DeFi is growing substantially along with the entire crypto space. Yields are strong and a growing contingency of the crypto space realizes the value of stablecoin farming on OneRing. Platform TVL has grown to $100m USD (our goal), the platform is generating 15% yield for its users, and the same 75% of $RING is staked. Under this optimal scenario, 100k staked $RING (current value: $1,270) delivers $2,500 in real yield for the staker.
You get the picture: the more OneRing grows and the more crypto and DeFi grow, the more $RING stakers’ portfolios will grow.
Please remember that these early projections and as we all know all too well in crypto, anything is possible. Regardless of which scenario plays out, OneRing will still be the place to ‘Yield them all.’
About OneRing
OneRing is the first multi-chain cross-stable coin yield optimizer in the space. The goal of OneRing is to take away the complexity of DeFi and make things easy for the user. By this, we will be able to open the DeFi space for a whole new layer of users that want to receive yield on their stables instead of just having them sit in their wallets. With a strong network of partners, KOLs, advisors, and such, OneRing aims to go right to the top and set new benchmarks for DeFi.
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