WOOFi’s new Supercharger vaults unlock institutional yield opportunities to DeFi stakers
Now anyone can deposit single-sided BNB and earn best-in-class yield by leveraging WOOFi’s capital-efficient sPMM liquidity
WOOFi Earn is bringing you the next generation of “set-and-forget” earning strategies with the release of its very first Supercharger vault.
A single-sided staking solution
Earning yield in DeFi can be painstaking to say the least, and nowhere better is this exemplified than in typical two-sided automated market maker (AMM) liquidity pools. Not only are they inflexible, forcing the LP to maintain equal exposure to two separate assets (which they may not want to), they also subject the LP to risk of impermanent loss.
Introducing the Supercharger vault, a single-sided staking solution which serves to remove these constraints by allowing the user to deposit just a single token and earn yield, without any form of compromise. DeFi yield farming shouldn’t have to be full of hassle and hurdles, and the Supercharger vault is here to demonstrate just that.
The science behind the Supercharger
Simply put, the Supercharger vault does that which AMM pools can’t, accruing yield from two separate sources: liquidity provision and external yield farming.
The external yield farming generates a base APY on the deposited funds, and this typically entails a low-risk auto-compounding strategy such as lending. In addition, the WOOFi liquidity provider (i.e.Kronos Research) may then borrow up to 90% of the assets within the vault at a fixed rate to provide liquidity on WOOFi. Due to the difference in risk profile, the loan can provide even higher return for depositors. With this combination of strategies, users get to earn yield with professional market makers all while maximizing capital efficiency and supercharging WOOFi’s liquidity.
The best part? There’s no impermanent loss. The WOOFi LP mitigates this risk by hedging their exposure on WOO X, ensuring that there are always enough funds for users to withdraw upon request. All of this takes place over a 7-day settlement cycle that restarts after a 24-hour settlement at the end of each week.
What can be deposited?
The very first WOOFi Supercharger vault is live on BNB Chain, and supports single-sided BNB only. Moving forward, the deployment of more Supercharger vaults will allow WOOFi to scale across more assets and chains, until WOOFi users are able to earn competitive and low-risk yield on any asset of their choosing.
How do withdrawals work?
Users can request to withdraw their deposited BNB with no fee or limit (except when the vault is under settlement) and may withdraw once the settlement is complete. 10% of the TVL will be set aside each week for instant withdrawals, though a 0.3% withdrawal fee will be charged to prevent abuse of this system.
What are the risks?
Your security is our absolute priority, which is why we’ve adopted a belt and braces approach to mitigate risk of stolen funds. When the loan is initiated to the LP (Kronos Research), funds can only be withdrawn to the WOOFi liquidity pool smart contract, and any withdrawals from the liquidity pool must be approved by a MultiSig wallet. For peace of mind, these contracts have been fully audited by CertiK, and the strategy behind WOOFi’s Synthetic Proactive Market Making (sPMM) has been rigorously battle-tested.
Stay tuned for all of WOO Network’s exciting developments!
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