Introducing $UBE: The Start of Celo Yield Farming

Ian Macalinao
Ubeswap
Published in
4 min readApr 19, 2021

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UBE, the Ubeswap Protocol token, is live!

Ubeswap’s mission is to increase the adoption of Celo, and we believe that the first step to getting there is to make it cheaper for users to trade on-chain by increasing liquidity. Over the past few months, we’ve been working hard on building an easy and secure user experience for yield farming on Celo.

Yield farming is a way for Ubeswap users to generate additional rewards on their existing crypto. Ubeswap rewards liquidity providers with UBE tokens, making trades much cheaper to perform without leaving the blockchain. Yield farming also turns the users of the protocol into token holders, rewarding protocol users with being early adopters of the project.

With Celo’s inclusive approach to DeFi, we hope to bring these yields to a much larger population and to enable users to invest in the various assets within the Celo ecosystem.

Token Distribution

As we mentioned in our launch article, users who provide liquidity to Ubeswap will earn additional rewards in the form of UBE governance tokens. To incentivize early adopters within the Celo community, users who trade or provide liquidity on Ubeswap during its first few weeks on Mainnet will become significant stakeholders in the protocol.

The hard cap of UBE is 100 million tokens.

There are three classes of tokens in Ubeswap:

Mined tokens — 72M tokens

  • These tokens are released over a period of 6 years, with a halving of issuance rate occuring every 26 weeks.

Released tokens — 25.7M tokens

  • These tokens are released to our team and early supporters over 156 weeks at an equal rate per week, i.e. basically a 3 year unlock period.
  • The 3 year period was chosen to ensure these early token holders are aligned long term with Celo and Ubeswap.
  • These tokens are stored in the ReleaseUbe contract, available here.

Liquidity — 2.3M tokens

  • These tokens are fully liquid at launch.
  • These tokens are held by the Executive Timelock for the sole purpose of providing liquidity to projects that integrate with Ubeswap.
The release schedule of the UBE token. Full details are in this spreadsheet.

Breaking down these classes further:

Mined

Mining Reserve — 34M tokens

  • These funds are held by a smart contract which releases tokens to farming pools weekly.
  • The farming pools are determined by the Executive Timelock.

Partnership & Ecosystem — 30M tokens

  • These funds are held by the Community Growth Timelock.
  • The Community Growth Timelock will allocate tokens towards growing the ecosystem by establishing grant programs and investing in high quality DeFi projects on Celo.

Celo Reserve — 8M tokens

  • These funds are held by a timelock which is ultimately owned by the Celo Reserve.
  • The UBE in this allocation will be used to collateralize the Celo Dollar and other Celo assets.

Released

  • Team/Advisors — 13M tokens
  • Early Supporters/Strategic Investors — 12.7M tokens

Liquidity

  • Protocol Treasury — 2.2M tokens
  • Launch — 100k tokens (added to the UBE-mcEUR and UBE-mcUSD pools at the farming start date at $0.10/token)

Pool Distribution

The initial issuance rate to liquidity mining pools is 654,000 UBE/week.

We intend to launch the following pools at launch:

  • UBE-mcEUR: 48% of rewards
  • UBE-mcUSD: 32% of rewards
  • CELO-mcUSD: 6% of rewards
  • CELO-mcEUR: 9% of rewards
  • mcUSD-mcEUR: 5% of rewards

mcUSD and mcEUR are versions of cUSD and cEUR which are staked on Moola.market. These tokens have less impermanent loss than their cAsset equivalents, since they earn interest from lending to borrowers on Moola.market.

Moola-powered Smart Order Routing

You may have noticed that there are no Celo cAssets on here (i.e. cUSD or cEUR). For non-DeFi users, having to stake Celo Dollars into Moola in order to swap to Moola cEUR, then to subsequently withdraw mcEUR into cEUR from Moola can be incredibly confusing.

Fortunately, we’ve developed a smart order router that routes trades through Moola when more cost-effective. You can buy CELO with cUSD via the CELO-mcUSD pool, since Ubeswap will automatically convert your Celo dollars into mcUSD *with zero additional slippage* to make the optimal trade.

This greatly benefits both liquidity providers and users, as liquidity providers can now earn interest on tokens they’d otherwise be losing value on to inflation.

The source to the smart contracts for this are available here: Link to GitHub

Audits

Our core contracts have been audited by Bramah.systems:

The smart order router has not been audited, but you will not interact with this as a liquidity provider. We plan on getting this audited in the next few weeks. In the meantime, you can find details of the router architecture and security safeguards on our wiki.

Next Steps

Over the next week, we’re planning on launching tutorial articles and videos on how to stake into Ubeswap. Join our Discord for the latest updates on this!

In the medium term, we’re planning on launching the following:

  • A Timelock visualization portal, so users can see admin-related actions
  • An on-chain governance system to allow token holders to propose changes to the protocol

We are also looking to hire a community manager after we launch. If you’re interested, please email team@ubeswap.org!

In the meantime, you should:

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Ian Macalinao
Ubeswap

software engineer, decentralization enthusiast