Duck Improvement Proposal: NFT Farming with 300%+ APY

In the first week following the launch of WavesDucks.com, users issued over 3,200 duck characters, locking more than $390,000 in EGG tokens in the smart contract. The project’s team continues to improve the game mechanics, proposing a new functionality: NFT duck farming with an APY of 300% to 5,000%.

The Duck Paper describes the value of duck NFTs as collectables: they could be received for EGG tokens, bred to produce rare NFTs and assembled into sets. This model has proven successful: users are eagerly collecting digital ducks, and some of them already have collections of more than 50 NFTs. To make the game more similar to real-world duck farm operation and enable players to monetize their collections (apart from buybacks), the project’s team is launching functionality for staking NFT ducks in a farm in which ducks “lay eggs” (EGG tokens), bringing passive income to their owners (farmers).

This update will allow players to put their ducks on a “perch” and collect passive income in EGG tokens, whose size depends upon a duck’s rarity and farm parameters. A genesis duck’s yields from 300% annually at EGG’s rate on May 27, 2021.

Duck farming

The first ever DeFi farming functionality for NFT tokens will be available for all characters in the game, including genesis ducks and new generation ducks produced as a result of breeding.

A new section, Farm, will be launched on WavesDucks.com where a user will be able to buy a “perch” in one of 4 colors at a tentative price of 1 EGG and put on it a duck of a matching color from their collection. A user can buy an unlimited number of perches, which makes the size of a duck farm unlimited, as well.

Duck farmers will collect a substantial part of issued EGG tokens: over the first year of the game, 36,000 EGG tokens will be distributed among them, meaning that about 4.1 EGG will be distributed between ducks in farming every hour. The number of EGG tokens to be distributed in subsequent years will be determined later with EGG governance.

One important question that you might have at this point is how many EGG tokens a digital duck can produce. This number — the farming reward — could be calculated based on its farming power.

Farming power(Duck) = Rarity * Farm quality * Farmer rating

Total farming power = the farming power of all ducks in the game

Farming reward(Duck) = Farming power(Duck) / Total farming power

Thus, 4.1 EGG will be distributed every hour among all duck NFTs in farming, based on their rarity and the rating of the farm and its owner.

To increase the farm quality, players could make improvements to their farms, such as building a pond for their ducks or buying a drake.

The default values of the farm quality and the farmer rating are set at 1, meaning that without improvements to the farm, a duck’s farming power equals its rarity.

APY estimation

To calculate how much you can make on a duck farming, its parameters and the entire number of ducks in farming should be taken into account.

Presently, if one half of all issued ducks is sent to farming, the total farming power will be 115. This number could go up, if the number of ducks in the game goes up and they are sent to farming, or go down, if ducks are withdrawn from staking — for instance, for breeding.

Say, your Duck Wallet contains two ducks: a genesis green Elon duck with a 3% rarity (8A-GG) and a very rare second-generation duck with a 100% rarity (3A5C-HG).

You can send both ducks to farming by buying two perches at 1 EGG each. Immediately after that, they will begin yielding rewards.

Let’s calculate an APY for these ducks, assuming the total farming power in a game will remain 115.

For the 8A duck with a 3% rarity, the farming reward will be 36,000 * 0.03 / 115 = 9.39 EGG annually, which, at an exchange rate for May 27, 2021, is $544.

Given that a genesis duck could be bought on WavesDucks.com for 3.1 EGG and some users were able to buy their ducks at 1 EGG, the APY is more than 300%.

For the 100% rare 3A5C duck, the farming reward will be even higher: 36,000 * 1 / 115 = 313.04 EGG ($18,154) a year. To produce a character of this kind, a user would have had to breed two genesis ducks (8A and 8C). Therefore, the investment was 3.1 + 3.1 = 6.2 EGG. The annual return on this investment turns out to be enormous: 5000+%. This high number is explained by the fact that 100% rare ducks are produced very seldom, and, mostly, “jackpot” ducks will show this kind of yield.

With this mechanic, the most lucrative strategy for collectors would be to continue breeding new ducks in a hope to produce a rare duck. That would not only improve a user’s chances of selling back their sets but also collecting a sizable farming reward.

Duck rarity calculation

The Duck Paper provides the following formula for calculation a duck’s rarity:

For each digital duck, a duck uniqueness ratio (Du) can be calculated based on the number of ducks (Nu) with the same genotype, using the formula Du = 1 / Nd.

The calculating algorithm is:

1: convert aaabbbbb to an abbreviated form: 3a5b

2: find ducks that inherit 3 genes from A and 5 genes from B. This category includes bbbbbaaa, abababbb etc, as the order of genes doesn’t matter

3: calculate the total number of ducks in that category — say, 10

4: using the formula Du = 1 / Nd, divide 1 by 10 and obtain Du = 0.1

The current situation in the game shows that many users prefer to breed ducks with the same genes (for instance, 8a and 8a) to produce a similar duck of a new generation (new-gen 8a). Therefore, a decision was made to take generation into account for rarity calculation. Once DIP-2 has been activated, Nd will include ducks that, in addition to the gene formular, will also be of the same generation. This will make the calculation system slightly fairer for players.

An updated rarity calculation formula will be added to the web app prior to the launch of the NFT farming functionality.

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This Duck Improvement Proposal is expected to become a major milestone in the progress of the Waves Ducks game: in addition to building their duck empire for collection or resale, players will be able to monetize it by launching a crypto farm.

In addition, the project’s team hopes that this update will attract wider attention from the crypto community as it contains an innovation, NFT farming, offering an equally innovative APY of 300% to 5,000%.

Join the Waves Ducks game to get your own duck and start building a duck empire!

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