One thing that kept our team’s morale up throughout this bear market is Pudgy Penguins. We love em. The NFT collection is famous for its cute characters and positive vibes. (Strongly recommend following their Instagram, great for motivation and mental health.)
As we started forming friendships with other penguin holders, we decided to build something fun for the Pudgy Penguins community: Peng Together, by Powerbomb Finance.
So, What Is Peng Together?
Peng Together is a set of smart contracts that puts a spin on DeFi with an NFT twist. Users deposit their crypto into our yield farming robot, but unlike conventional liquidity mining which pays rewards out in fungible tokens, Peng Together outputs yields as Lil Pudgy NFTs instead. As voted by our community, each Lil Pudgy bought via Peng Together is then randomly sent to the wallet of one user who contributed liquidity to the campaign. View the flow chart below!
Lil Pudgys are the secondary, companion collection to Pudgy Penguins, with a higher supply and lower price.
How Does Peng Together Work?
Chain
Peng Together is live on Optimism only. We’ve chosen this chain to launch on because of the OP token rewards given to DEX yield farmers.
Supported Pools
Peng Together currently runs on 2 liquidity pools on Curve:
- sUSD+3CRV: a pool of 4 stablecoins sUSD, USDT, USDC, DAI
- ETH+sETH: a pool of ETH and sETH
sUSD and sETH are both Synthetix assets pegged to the price of USD and ETH respectively.
Both Peng Together pools suit farmers of different risk profiles. sUSD+3CRV, being a stablecoin pool, is better for users who prefer minimal volatility. ETH+sETH is great for users who want price exposure to ether. ETH+sETH pays higher yields because of the higher portfolio variance.
These pools were selected for the low risk of impermanent loss, so that novice farmers don’t end up drastically losing the quantity of their tokens from market fluctuations.
Users can deposit and withdraw their liquidity anytime. There is no lock up.
Rewards
Both pools reward liquidity providers with CRV and OP tokens. Powerbomb’s yield farming algo constantly harvests the CRV and OP that users earn, and swaps them to ETH. (This has always been the basic function of the Powerbomb project, even before this Peng Together mod.)
Bridging
At this point, those of you with some familiarity with yield farming and NFTs might now ask: But your ETH is on the Optimism network, and Lil Pudgy NFTs are on Ethereum, how do you use this ETH to buy NFTs?
That’s why we have to bridge our ETH from Optimism to Ethereum. Peng Together uses Stargate to transfer assets over.
On Optimism, ETH rewards (converted from CRV and OP) accumulate till we have more than the minimum amount of ETH required to buy the cheapest Lil Pudgy NFT. When ETH rewards are greater than the price of the cheapest Lil Pudgy, our programme bridges the ETH over to Ethereum.
Buying Lil Pudgy
Once the ETH has arrived on Ethereum, our smart contract purchases the cheapest Lil Pudgy NFT on Sudoswap, an NFT marketplace.
Distribution of Lil Pudgy
We gave our community 3 options on how to deal with each Lil Pudgy we buy using the ETH we receive.
With more than half the voters in favour of A, we created a process where the Lil Pudgy is randomly sent to one Powerbomb user who contributed liquidity to the Peng Together campaign. We use a Chainlink RNG mechanism to keep the distribution fair and random. The more liquidity you deposit into the Peng Together pool, the higher your probability of receiving the Lil Pudgy.
Conclusion
That sums up the idea of Peng Together! Liquidity mining rewards on Optimism Curve will run till December, so if you’ve been considering getting a peng, use this chance to farm a Lil Pudgy and maybe you might join the huddle. It’s nice in here!
Powerbomb Finance is a decentralised asset management solution that helps you earn DeFi yields in a crypto of your choice. Launch your market making business in 3 easy steps with us!
