Panda Soft Synths

Summary

Using PandaSwap once again as a sandbox for contributors to learn, show initiative, and bring additional protocol value.

We have always stated that the infrastructure is not there for us to deploy on BSC. This was true, we used to have the price feeds on Polygon nests wired to Sushi subgraphs. However, since our implementation of nests on Polygon the Sushi subgraph has been down twice and in the process our protocol continuity. To mitigate this we have wired the price feeds up to CoinGecko, and this opens the opportunity to deploy Panda Ponds on BSC.

A thing we have to keep in mind is that the deployment will not be done by the smart contract galaxy or front-end galaxy. But by other contributors, if you are willing to contribute to this initiative as well you can let us know on our discord in the Panda-related channels. In the end, the smart contract galaxy and front-end will be performing a QA/QC before we put everything LIVE.

By deploying the soft synths with minimal help from the above galaxies we have opportunities for contributors:

  • Contributors to learn / work on / polish their smart contract development skills
  • Contributors to learn / work on / polish their front-end development skills
  • Bringing life and love to the Panda franchise

Abstract

This concept consists of multiple topics, during the concept phase we would like to formalize a mini bill or decide to vote on the topics separately. Anything here is a concept so nothing is set in stone.

The items we are trying to reach a consensus on are the following:

  • Discussion on the creation of a temporary PandaSwap galaxy, where contributors can apply to help with the deployment of soft synths.
  • Discussion on the deployment of soft synths on Binance Smart Chain (BSC).
  • Discussion on the starting ponds and their parameters.
  • Discussion on restructuring the farms, which will be closed, and will we be adding new.
  • Discussion on the unlock strategy going forward.
  • Discussion on how to formulate the proposal(s).

The goal is to decide on the proposal and which topics will be included. This means if adopted the proposal seeks to:

  1. Agree on the creation of a temporary galaxy with a low operating budget ($250 BUSD/BNB).
  2. Agree which ponds to start with on Binance Smart Chain.
  3. Define a fee structure for ponds.
  4. Define a rebalancing strategy.
  5. Approve yield options for underlying assets.
  6. Approve the closure and creation of new farms.
  7. Agree on what to do with the excess token from the closed farms.
  8. Agree on the unlock strategy, keep current unlock, extend current unlock with no changes or extend current unlock and implement vePNDA.

Background

Soft synths are deployed on Polygon under our Polly Finance franchise, and we recently deployed them as well on mainnet for Bao.

With this proposal, we seek to find support to deploy soft synths on BSC and agree on the way forward with this franchise. But keep in mind there will be minimal support from other galaxies as they have other responsibilities to focus on.

The implementation will largely be the same as Polygon, gas costs are higher than on Polygon but the oven functionality as we have planned for mainnet is not considered yet. Unless we feel this is needed for BSC as well in the future.

For those unfamiliar with the term the oven, please check the description below:

The “oven” accepts ETH deposits and waits until there is 10ETH deposited before carrying out the mint transactions, allowing everyone that uses it to share the gas costs involved with minting new baskets.

You can find the original proposal to deploy soft synths on polygon here: [BIP - 2] Accelerated Proposal for nDEFI 3

Topics to discuss

  1. Galaxy creation
  2. Ponds
  3. Farm restructuring
  4. Unlock strategy

Galaxy creation

As part of our decentralization process, it could be important for this deployment to have a distinct galaxy that will support the day-to-day operations on BSC. The galaxy will be a temporary one with a low operating budget and a multi-sig.

This new galaxy’s roles and responsibilities would include among other things:

  • Deploying Soft Synths with the needed refactoring.
  • Updating the frontend with the needed refactoring.
  • Testing the deployment of ponds.
  • Exploring alternative ponds strategies for yield.
  • Creating the documentation and communication for the refactoring and deployments.
  • Collecting the outstanding fees for Bamboo and checking if it should be done on a monthly basis.
  • Reporting the progress of the deployment activities.

The initial composition of the galaxy will be decided on; however, the following Guardians are open to or will be part of the initiative:

  • Baowolf
  • fabiaZ84

The guardians and contributors from the existing galaxy will be consulted but new contributors can also apply to help with the deployment. As mentioned, the initial operating budget should be 250$ max.

After the delivery, we will evaluate the contributions and the viability if we would keep the galaxy active.

Ponds

1. Starting Ponds

We would like to propose starting with 3 baskets, pCEFI, pSTBL, and pNTWRK.

The current versions are mockups, we would like to openly discuss what the community would like to see. For this we can use BSC TVL - DefiLlama to define the composition.

pCEFI and pNTWRK

Following a similar theme to the nDEFI nest on Polly Finance, we will release a similar product on BSC, designed to weigh more towards projects with a high Total Value Locked (TVL) on BSC.

The Total Value Locked (TVL) on BSC is chosen. The criteria for inclusion and weightings are defined as:

  • Top projects by TVL, that operate on BSC
  • Has sufficient liquidity (min $450k) on a BSC exchange
  • Have a ChainLink price feed on BSC
  • At least 3 months old

Based on the selected criteria, if deployed when data was collected the pond would look like this: see the attachment below the pSTBL description.

pSTBL

The pSTBL basket is designed to provide yield-bearing exposure to a basket of stable coins, helping to negate risk and provide a low-effort means of yield farming the best low-risk yields available.

The criteria for inclusion and weightings are defined as:

  • Stable coins based on yield potential from the available yield options
  • Weighted evenly
  • Has at least $2m Liquidity on a BSC exchange
  • Have a ChainLink price feed on BSC
  • At least 3 months old

2. Fee structure

The fees are broken down as follows:

  • Entry fee 0.5%:
  • Annual streaming fee 1%:
  • Exit fee 1%:

All fees will be split evenly between burning PNDA and the treasury. In case we decide to implement vePNDA the fees will be split evenly between all 3 - burning PNDA, the treasury, and staking rewards without the need for a further governance vote.

3. Rebalancing

Ponds are maintained quarterly in two phases

Determination Phase

The determination phase takes place during the final 2 weeks of the quarter. During this phase the changes needed for the next reconstitution are determined.

Proposed changes will be published on the governance forum for 1 week then a governance vote will run for the community to approve changes.

Reconstitution Phase

In the two weeks following a successful vote, the nest components will be adjusted as per the instructions published during the final 2 weeks of the quarter.

Emergency Maintenance

The multi-sig holders are authorized by the community to re-balance nests outside of the usual schedule during moments that they collectively deem to be critical emergencies. This clause will allow for quick re-balancing in the event of a protocol or nests being in danger of failing. An example of when this would be utilized would be if a stable coin begins losing its peg/ becoming insolvent, or a protocol suffers an exploit that is not dealt with sufficiently.

These scenarios may be time-sensitive and require immediate resolution. Thus, the team may decide to act without warning and explain their actions in a governance forum post afterward, or if there is deemed to be time, an emergency governance vote will be posted.

This is intended as a safety mechanism only, to prevent loss of funds for our users and as such would be a power exclusively exercised under extreme circumstances.

4. Yield options for underlying assets

Yield farming will be approved on the following projects for all tokens

  • Cream

Please let us know if there are any other options we should consider, the idea is to explore more strategies on BSC once the MVP has been deployed.

Farms

This point will authorize the multi-sig to end the current farms which are still dripping out Panda without cause, instead we would like to reserve these rewards as future incentives.

To do this we will create a ‘meta pool’ which will reward a test token and set it to a high number of points in the system. That test token will be held by the multisig. This will allow the remaining Panda rewards to flow into the multisig to be used for future incentives.

This will NOT apply to the certain Panda pools that continue to provide Panda with some basic liquidity. The rewards from these pools will be adjusted to try and maintain roughly their current reward levels within this switch.

Additionally, new Farms will be created for the ponds which we will create.

Unlock strategy

Currently, the unlock has been postponed for 6 months from its initial unlock date.
With this topic, we would like to align what to do with the unlock.

  1. We keep the current unlock date.
  2. We extend the unlock date until Pandaswap has generated 1M in revenue.
  3. We extend the unlock date and follow the current discussion ongoing for Bao and implement something similar as well for Panda creating vePNDA.