yvBOOST: a sleeping giant
just a hunch about when forgotten productive assets remain productive
Kinda random exploration
Yearn veCRV "Backscratcher" Vault
It has a problem
It was launched as a Sushi pool since at the time Curve Factory Pools did not exist. This was not an adequate marketplace and could not well support the pool. This was also pre Curve renasance. As such, yveCRV lost its peg. In order to earn a factory pool and gauge weights, it must earn its peg. Perhaps that is a quest Yearn is set out to achieve?
yveCRV is a complex ecosystem, so lets explore it.
veCRV (Curve locked governance contract)
Address: 0x5f3b5DfEb7B28CDbD7FAba78963EE202a494e2A2
Total Supply: 368,825,045.894025425481115008
yveCRV (Yearns Wrapper)
This vault accepts CRV in exchange for perpetual claim on Curve DAO admin fees across all Yearn products.
Since it locks CRV in Curve Voting Escrow for 4 years and regularly prolongs the lock, this vault doesn't have withdrawal functionality.
curve apy: 4.88%
vault apy: 16.04%
vault vs solo: 3.28x
rewards in vault: 1,056,898.01 3Crv
epochs claimed: 4817/4834
total supply: 13,592,126.60 yveCRV (3.685% of total)
yearn vecrv: 23,333,338.15 veCRV (6.326% of total)
total vecrv: 368,822,874.45 veCRV
yveCRV [yveCRV-DAO] (non withdrawable)
Address: 0xc5bDdf9843308380375a611c18B50Fb9341f502A
Total Supply: 13,592,126.608801312035541793
~58.25% of CRV held by Yearn.
yveCRV is named yveCRV-DAO on the contract level.
This vault is paid via 3pool (USDC/DAI/USDT) approximately weekly.
This should be the sum of the 3pool earnings from the underlying veCRV held by dao in addition to a 10% share of the gauge boost vault earnings. [ref]
Yearn periodically donates some of the farmed CRV to the yveCRV vault. So in addition to normal CRV rewards, you will be able to claim Yearn’s portion of Curve’s protocol fees.
You can’t vote on Curve. But, Yearn runs a simulation and votes to maximize yield across all vaults. So automation is actually doing the job for you.
It is said that bribes more than pay for themselves. Perhaps extracted farming value from the LP side of the equation outweighs the bribe return and the trade off of optimizing yield for vaults is worthwhile? We shall see.
yCRVVoter (actually contains votes)
Address: 0xF147b8125d2ef93FB6965Db97D6746952a133934
Balance: 23,333,487.237032711066730365 veCRV
~6.33% of total supply of veCRV
This handles the actual voting as the whitelisted address for Yearn’s veCRV holdings.
yvBoost
Address: 0x9d409a0a012cfba9b15f6d4b36ac57a46966ab9a
Total Supply: 9,793,131.62117816416359125
Balance: 86,023.506161915606597186 yveCRV-DAO
~0.6% of yveCRV-DAO
Remainder of assets deposited in Strategy
This is the compounding version of yveCRV
If you lock CRV here, it will claim the protocol rewards and automatically buy more yveCRV.
Rewards are donated to the pool, such as autofarming EPS airdrop, and now bribes as well. These rewards are passed onto only the yveBOOST component [source].
StrategyYearnVeCRV Strategy
Address: 0x2923a58c1831205c854dbea001809b194fdb3fa5
Balance: 12,440,229.382756525641136582 yveCRV-DAO
~91% of yveCRV total supply.
Balance: 2,806.447663970140254628 yvBOOST
~0.029% of yvBoost supply
~228th largest yvBoost holder.
This is the strategy Yearn yvBOOST is assigned to.
Average APR: 132.01%
Strategy Description
Diving in
yvBOOST:
Top holder: Sushi ~10.9%
1,058,000 yvBOOST
1,021 WETH
holders obscured, 90% being in Sushi Masterchef.
#4 holder: Uniswap 5.5% [nansen v3 pair]
The above has the following price range:
Leftmost Tick
0.0015 ETH per yvBOOST (150% vs Current Tick [$4.8 at $3200/ETH])
678.3572 yvBOOST per ETH (65% vs Current Tick)
Current Tick
0.001 ETH per yvBOOST
1,032.4119 yvBOOST per ETH
Rightmost Tick
0.00005 ETH per yvBOOST (5% vs Current Tick [$0.16 at $3200/ETH])
1,997.4368 yvBOOST per ETH (193.472857103 vs Current Tick)
We can see there is a large concentrated block of liquidity that appears to be evenly distributed, almost reminiscent of being one consistent position…
Note the price is about 2/3 broken through this sell wall.
When comparing the two types of derivatives, compounding, and auto compounding, we can see that there is more liquidity on the market for yvBOOST than yveCRV-DAO
yveCRV-DAO:
sushiswap
340,200 yveCRV-DAO
258.4 WETH
6,284.802053484100889309 SLP staked to master chef
70.5%
biggest holder:
0xb2cfdc1d0152e8c660aa57cbd323a8ac624f32c5
2,317.521985489850402531 SLP
26%
Recall we can always swap 1 CRV for 1 yveCRV-DAO but we cannot swap 1 yveCRV-DAO for 1 CRV.
We can also deposit/withdraw yveCRV-DAO from yvBOOST.
Suspicions
It is my expectation that if liquidity were to be incentivized that we would find it incentivized in the auto-compounding version of yvBOOST instead of yveCRV-DAO. We can see liquidity is far higher for yvBOOST
This slightly complicates things as its price slowly rises vs others but does reduce complexity in dealing with an external yield stream. Would be cool though, to have Curve’s native veCRV 3pool rewards boosted by supplying liquidity to a yveCRV-DAO factory pool via the external stream of 3pool that vault produces.
If yveCRV-DAO is to be the one, then it could use current factory pools.
Either way, there is limited liquidity on markets, and now constant buy pressure.
What’s interesting is the compounding is in the base token yveCRV-DAO not yvBOOST. yveCRV-DAO has less liquidity on market, and depositing that in yvBOOST without issuing new tokens. So in theory, the price of yvCRV-DAO should rise faster than yvBOOST and so compounding there should be somewhat dampened vs the price of yvBOOST.
Correction:
So
There exists 9,793,131 yvBOOST which represents:
12,440,229 yveCRV
of a total supply of 13,592,126 (~91% of yveCRV)
These are earning at ~100% APY and that yield is buying itself off the market as an upwards price force.
340,200 yveCRV-DAO on Sushi
1,058,000 yvBOOST on Sushi
540,000 yvBOOST on Uniswap
Price held tighter for the first 1/3 of the yvBOOST market via Uniswap.
Total Supply
yveCRV-DAO: 13,592,126
yvBOOST: 9,793,131
On Market:
yveCRV-DAO: 340,200 (~2.5%)
yvBOOST: 1,598,000 (~16.3% of which ~5.5% on Uniswap)
It doesn't need to buy it all since that would set its price to infinity, and at 100% APY, 16% self purchase should occur relatively early in the year. Most existing supply is in (90%) is in yvBOOST, which is committed to repurchasing yveCRV. This signals a willingness to further entrenching themselves until the peg is returned and may indicate the dump pressure wont be too bad when the peg returns.
This is buying up a CRV derivative at a discount vs Curve. A derivative optimized to earn fees without the bearing of governance responsibilities. I’m of the opinion while protocols would do better to gain governance abilities, retail farmers would do better to simply earn the boosted yield with yvBOOST than play the CVX or cvxCRV game.
yvBOOST w/ 91% of yveCRV-DAO supply contained signals strong (3,3) mentality for holders, buying themselves out of a dip together as a force.
I think the market, while idle, projects a strong comeback for yvBOOST with new ve(3,3) ideas and upgrades broadly across yearn vaults.
more references:
New yveCRV
https://gov.yearn.finance/t/proposal-bootstrap-the-minting-of-new-yvecrv/11630
yveCRV v1 vs yvBOOST v2 net APY
https://gov.yearn.finance/t/yvecrv-v1-vs-yvboost-v2-net-apy/11463
[Proposal] Allow yvBOOST to vote on new CRV gauges
https://gov.yearn.finance/t/proposal-allow-yvboost-to-vote-on-new-crv-gauges/11800