Unveiling the Berachain PoL Supercharger, Artio, Points, & More!
If youâre reading this, itâs probably because youâre already bera pilled and highly anticipating what could be the greatest economic advancement to play out on our beloved databases we call blockchains.
âAnyway so Berachain allows you to rehypothecate erogenous assets as security.â âBeraMVP
Berachainâs Proof of Liquidity consensus (PoL) introduces a harmonious relationship between on-chain liquidity & security â solving stake centralization experienced on Proof of Stake mechanisms and aligning incentives between protocols & validators â creating an ecosystem that systematically scales liquidity.
So how does this play out?
Probabilistically: TVL numba more likely to go up.
But to further specify where the value accumulates on-chain, we can look at Ethereum to help create a baseline of expectations.
As seen on DeFiLlama, capital has primarily concentrated across Liquid Staking (a lot of which chases additional yield in DeFi), Money Markets, Dexes, and Yield Services/Automation.
All capital, even if Delta-neutral, is exposed to short Gamma (IL) meaning itâs at risk of losing yield EV potential, or worse, suffering net losses from Impermanent Loss.
In fact, on-chain analysis done by 0xShittrader & thiccyth0t discovered that the Uniswap v3 ETH/USDC pool alone had generated ~$100m in cumulative losses for LPs at the time it was conducted over a year ago.
Itâs hardly taboo anymore, but the reality is only a few sophisticated players profit from LPing.
Henlo Impermanent Gain
Smilee created a worlds-first derivative called Impermanent Gain. It turns Impermanent Loss from a bug to a feature for both buyers (traders) and sellers (LPs).
Smileeâs synthetic engine decomposes clAMM LP positions and recomposes them into tradeable options:
Among many things, buying Impermanent Gain empowers LPs to perfectly hedge their Gamma (IL) exposure in some cases, or greatly reduce it in others:
You might see how the picture is starting to form in relation to PoL but to really make the beras roar, letâs break down the PoL fueled Berachain spot market equation:
LP Returns = Fees + $BGT
The additional yield from $BGT by itself could make Berachain the best infra for DEX yield in all of DeFi, but what if we could transform this equation to:
LP Returns = Fees + $BGT â IL
For any bera DEX LP buying Impermanent Gain to hedge IL, or Smilee LP:
LP Returns = Fees + $BGT â Premium
With Smilee as the sole solution to hedge IL, Berachain becomes an absolute powerhouse for yield, scaling spot markets & beyond.
Now for our next trickâin addition to infra to Berachain as a wholeâweâve innovated DEX style LPing within our own productâŚ
Smilee Earn
Smilee transforms LPs into options sellers, designed to fairly-compensate LPs for their Gamma (IL) risk instead of solely earning fees from trading volume (no relationship to volatility).
Our LPs earn yield from:
- Impermanent Gain buyers (Premiums) set by Implied Volatility
- Bid/Ask spread from our volatility AMM
- And atomic delta hedge
Smileeâs novel approach has been shown to improve DEX LP performance as pictured above, and soon these benefits will be making their way to your favorite AMM on Berachain. đ¤Ť
Weâve officially made it 491 words without mentioning leverage and the appeal to traders.
Thereâs a single word that captures the raw ooga booga steel & twisted s*x appeal of Impermanent Gain for traders:
Asymmetry; limited downside, infinite upside potential.
Unlike Perps or Call & Put options, Impermanent Gain gives traders an exponential (convex) payoff as demonstrated below.
In other words, the more right you are (ITM), the greater the exponential return; all while capping your loss potential/no liquidation risk.
Impermanent Gain allows you to go long, short, or delta neutral with up to 2,000x leverage & no liquidations! Furthermore, Smileeâs synthetic clAMM allows you to trade in/out of positions whenever you please.
Simply put, Impermanent Gain is the most robust asymmetric R:R derivative in all of crypto.
Ooga Booga Conclusion
As we embark on possibly the greatest economic experiment of capital & security efficiency a Blockchain has ever seen, Smilee will be an integral piece of infra, supercharging PoL and empowering traders with the best asymmetric R:R.
Berachain Artio, Partners, & Points
Smilee deploys on Artio soonâ˘ď¸, and weâre giving initial access exclusively to our community & partners:
- Certifed Chad role in our Discord
- Berachain NFTs
- Beranames
- Honey Combs
- Hungrybera
If you meet the criteria above, you can head to our Galxe Campaign to claim your Smilee on Berachain Artio Access Pass + points at:
https://galxe.com/6QcBpqL5p43Gh8UQeb8oxj/campaign/GCohYt4gsX
You beras will have the Smilee testnet environment all to yourselves for a while, allowing you to get ahead/farm more points before it's opened up to the public
