Introducing Saffron V2
Today we are proud to announce the beta launch of Saffron V2 on both Binance Smart Chain and Ethereum mainnet!
The beta launch is scheduled for Wednesday at 18:00 UTC. Applications to participate in the V2 beta will be processed via this form. Users who wish to participate at launch time should fill out the form no later than Tuesday at 18:00 UTC.
What is Saffron V2 and what does it mean for the future of the protocol?
Saffron V2
At a high level, Saffron V2:
- Adds 4 new pool types
- Implements new capabilities for Binance Smart Chain as well as Ethereum (The V2 beta includes earning BUSD yield on Venus and ETH yield on Alpha Homora)
- Upgrades the original V1 pool types
- Introduces 4 new key features:
- Perpetual staking
- Unlocked pools
- Liquidity targeting
- Tranched exchange rates
New pool types
Saffron V2 introduces 4 new pool types.
- Market rate pool - where the cost of insurance rises and falls based on demand, and junior tranche returns reflect tranche capacity. This pool launches in beta mode today.
- Fixed interest rate pool - where the senior tranche earns a steady APY, and junior tranche has a variable return rate.
- Perpetual ERC20 staking pool - where users can participate in SFI staking, Sushi LP, and UNI-V2 for rewards. SLP and UNI-V2 pools will transition into IL mitigation pools later on.
- Impermanent loss mitigation pool - where senior tranche buys protection against impermanent loss, and junior tranche earns enhanced APY from trading fees and/or Liquidity Mining rewards (more details to come).
Binance Smart Chain & Ethereum pools with Alpha & Venus
The first V2 pools will be market rate pools with S, AA, and A tranches enabled for BUSD/Venus and ETH/Alpha adapters. This means BUSD will be supplied to Venus to earn yield on BSC, and ETH will be supplied to Alpha Homora’s ibETH contract to earn yield on Ethereum.
Enhanced V1 pools
The existing V1 enhanced interest rate pool (10X junior tranche DAI/Compound, DAI/Rari, WBTC/Compound, etc.) will be next to receive an upgrade to the new V2 perpetual enhanced interest rate pool structure. More information on this will be released in a detailed post follow-up.
Each of the new pools have passed the conceptual stage and already have code committed. We plan to iterate on and greatly expand new pool types during the duration of the V2 beta. Saffron V2 is flexible and will result in a wide variety of new pools implementing creative solutions for the unique challenges of decentralized finance.
New features
Some of the new features in V2 pools include, but are not limited to:
- Perpetual staking - where pools with epochs roll over automatically. Major gas savings and user experience improvement.
- Unlocked pools - replacing time-locked capital with a yield curve based on utilization rate. Users can join and leave unlocked pools at any time. The market rate pool released today is the first implementation of an unlocked pool.
- Liquidity targeting (target APY = SFI price * reward schedule / TVL) for more effective distribution of SFI liquidity mining rewards.
- Tranched exchange rates - a new concept invented by the Saffron team.
Tranched exchange rates
Tranched exchange rates are a new concept pioneered by our team and replace the V1 SAFF-LP token structure. V2 SAFF-LP tokens accrue value over time with an ever-increasing exchange rate relative to pool base assets. This new LP token structure powers each of the new features listed above and has the added benefit of simplifying integration with DeFi visualization software and widely used dashboards (Zapper, Zerion, DeBank, and more).
Governance
Saffron V2 makes off-chain governance much easier to implement. The structure of the V2 pools makes LP tokens more consistent, introduces a general interface for exchange rates, and will include new governance features built in to each pool.
We are also hiring for a new role: governance developer, who we imagine as a blend between programmer and human coordination optimizer. The eventual goal of Saffron is to become a fully autonomous and decentralized organization that self-perpetuates and captures value via the protocol’s optimization of risk and return. If that sounds interesting to you then please don’t hesitate to join the community and participate in building governance today.
Thank you
I want to extend a special thanks to the community, to everyone who took their time to provide feedback on V1, and to all who gave their valuable input and shared their experience with us to guide the direction of V2 and beyond.
Community resources
Web3 app: https://saffron.finance
Telegram: https://t.me/saffronfinance
Discord: https://discord.gg/pDXpXKY
Twitter: https://twitter.com/saffronfinance_
Github: https://github.com/saffron-finance/saffron
