Auxo is a DeFi platform that offers trust-minimized farming, rewards in ETH, and non-dilutive tokenomics.
Auxo is a DeFi platform that offers trust-minimized farming, rewards in ETH, and non-dilutive tokenomics.
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Auxo Passive Reward Vault Token (PRV) is a transferable derivative token built on top of the Active Reward Vault.
Unlike ARV, PRV holders earn rewards in perpetuity without any obligations to participate in active governance or maintain a long stake duration. Being transferable, secondary markets may support the trading of PRV at varying rates.
Due to this difference, ARV holders are allocated a higher split of total rewards, versus PRV holders:
70% of all total rewards are allocated to ARV, 30% of all total rewards to PRV.
The amount of rewards per user will depend on the total supply of ARV and PRV
PRV rewards are paid to users on a monthly basis once they have staked PRV for a full staking epoch, more on this below.
Converting Auxo to PRV is reversible but may be subject to restrictions based on a withdrawal queue. There is also a 1% exit fee charged on withdrawals.
DAO members with no interest in direct governance seeking a passive approach.
Participants who want the possibility of being able to exit their position earlier than ARV
Users who are concerned about minimizing both the gas expenditures and effort required to maintain a fully maximized rewards position.
Auxo Passive Reward Vault Token (PRV) is a transferable derivative token built on top of the Active Reward Vault.
Unlike ARV, PRV holders earn rewards in perpetuity without any obligations to participate in active governance or maintain a long stake duration. Being transferable, secondary markets may support the trading of PRV at varying rates.
Due to this difference, ARV holders are allocated a higher split of total rewards, versus PRV holders:
70% of all total rewards are allocated to ARV, 30% of all total rewards to PRV.
The amount of rewards per user will depend on the total supply of ARV and PRV
PRV rewards are paid to users on a monthly basis once they have staked PRV for a full staking epoch, more on this below.
Converting Auxo to PRV is reversible but may be subject to restrictions based on a withdrawal queue. There is also a 1% exit fee charged on withdrawals.
DAO members with no interest in direct governance seeking a passive approach.
Participants who want the possibility of being able to exit their position earlier than ARV
Users who are concerned about minimizing both the gas expenditures and effort required to maintain a fully maximized rewards position.
PRV must be staked in the PRV Locker for a full staking epoch before rewards can be claimed. However, users need only do this once: staked tokens continue to earn rewards in perpetuity until the PRV is unstaked.
A staking epoch lasts for a full calendar month and begins on at the start of said month, as an example:
Assume we have an epoch March epoch which lasts from block X (00:00 March 1st) → block Y (23:59 March 31st)
Rewards for the March Epoch will be distributed after the epoch is over (at the start of April)
Alice stakes 100 PRV on the 20th February. This is before the March Epoch begins and so Alice will be eligible for the rewards distribution at the end of the epoch.
Bob stakes 100 PRV on the 2nd March, Bob will not be eligible for rewards, until the end of the next epoch (at the end of April/start of May)
If Alice staked 50 PRV more before March Epoch begins, then her 150 PRV would be eligible for rewards at the start of April.
If Alice staked 50 PRV more after March Epoch ************begins, she will earn rewards on 100 PRV at the end of March Epoch and then will earn rewards on the full 150 PRV at the end of the April Epoch.
Therefore, a user will typically wait 4 - 8 weeks before their first rewards are eligible
⚠️ Staked PRV can be withdrawn at any time and transferred, but once withdrawn, the user would have to re-deposit and wait for a full epoch to finish before being eligible for rewards
Prior to a distribution, the DAO will gather staking data for PRV from relevant sources, and construct a view of the proposed rewards distribution. This will be shared to DAO members, who will be asked to vote on the validity of the proposed distribution.
If the distribution is notarized (voted as valid), the DAO will distribute rewards via a distributor contract.
If not, the DAO will resolve any issues and resubmit a new proposal for distribution.
Rewards will be distributed in WETH and will be claimable via a rewards contract. Rewards from multiple epochs can be claimed at once, there is no need for stakers to claim every month.
The amount of PRV that can be redeemed for AUXO each epoch (redemption availability) will vary based on how the price of AUXO trades compared to the treasury net asset value (NAV). As NAV is considered to be the fair market value for AUXO, the redemption mechanism was designed to help the price stabilize around the NAV (denominated in ETH).
The system will work as follows:
At the beginning of each epoch, the price of AUXO will be assessed based on how it is trading relative to the NAV.
1.Shall the price of AUXO (denominated in ETH) trade at a discount, no AUXO will be redeemable through PRV in the given epoch.
2.Shall the price of AUXO (denominated in ETH) trade at a premium, PRV will be redeemable for AUXO proportionally to the magnitude of the premium per-se. Simply put, the larger the premium, the more AUXO can be redeemed through PRV.
In code terms, withdrawals only active in a given epoch if(AUXOETH > NAV_eth*(1 + B%))
where:
AUXOETH, is the price of AUXO denominated in ETH
NAV_eth, is the net asset value of AUXO denominated in ETH
The B factor is a parameter ranging between 5% and 50% that will act as a ‘buffer’ (hence the B) and will be selected by the treasury committee each epoch. The B factor exists to mitigate additional selling pressure that could suppress the price of AUXO into further discount.
For instance, if at the beginning of an epoch AUXO will be trading at a 50% premium with respect to its NAV, then the B factor may be chosen to be somewhere between 5% and 15%. In other words, the magnitude of the redemption of that epoch will be as big as to allow enough selling pressure to bring down the price to 5% or 15% above NAV. Practically speaking, if the entire redemption availability gets filled and organic selling pressure adds on top of if, the price may very well trade within the buffer (below NAV*(1 + B%)).
On the other hand, if at the beginning of the epoch the price of AUXO finds itself trading below a 5% premium to NAV, then no redemptions would be put in place for the current epoch. This is because, shall redemptions be activated to bring the price down to NAV, additional organic selling pressure may add up and suppress the price further in undervalued territory.
In sum, the buffer will act as an additional price stability mechanism where the higher the premium vs NAV at the epoch start, the more room there will be for PRV redemptions into AUXO.
The system described above implies that shall there be little demand for AUXO (aka, AUXO trading at or below NAV) no redemptions would be available for PRV holders until the price starts trading at a healthy premium. On the other hand however, in periods of high demand and higher price appreciation, redemption rates can turn to be quite high thus allowing PRV holders to own more liquid holdings while at the same time ensuring the price of AUXO not to trade at many multiples above its fair market value.
PRV is a fully backed future claim on AUXO which earns rewards. PRV holders bet that AUXO price will be trading at healthy levels and get rewarded for stabilizing the market when it is trading at discount to NAV by keeping AUXO away from circulation.
💡 There is no guarantee of peg between Auxo and PRV, however, those tokens are likely to be priced at similar levels.
As a final point: ARV can be converted to PRV, subject to an early termination penalty of 20%. In this case, the user’s original deposit of Auxo will be used to mint PRV, and the user’s ARV will be burned.
PRV must be staked in the PRV Locker for a full staking epoch before rewards can be claimed. However, users need only do this once: staked tokens continue to earn rewards in perpetuity until the PRV is unstaked.
A staking epoch lasts for a full calendar month and begins on at the start of said month, as an example:
Assume we have an epoch March epoch which lasts from block X (00:00 March 1st) → block Y (23:59 March 31st)
Rewards for the March Epoch will be distributed after the epoch is over (at the start of April)
Alice stakes 100 PRV on the 20th February. This is before the March Epoch begins and so Alice will be eligible for the rewards distribution at the end of the epoch.
Bob stakes 100 PRV on the 2nd March, Bob will not be eligible for rewards, until the end of the next epoch (at the end of April/start of May)
If Alice staked 50 PRV more before March Epoch begins, then her 150 PRV would be eligible for rewards at the start of April.
If Alice staked 50 PRV more after March Epoch ************begins, she will earn rewards on 100 PRV at the end of March Epoch and then will earn rewards on the full 150 PRV at the end of the April Epoch.
Therefore, a user will typically wait 4 - 8 weeks before their first rewards are eligible
⚠️ Staked PRV can be withdrawn at any time and transferred, but once withdrawn, the user would have to re-deposit and wait for a full epoch to finish before being eligible for rewards
Prior to a distribution, the DAO will gather staking data for PRV from relevant sources, and construct a view of the proposed rewards distribution. This will be shared to DAO members, who will be asked to vote on the validity of the proposed distribution.
If the distribution is notarized (voted as valid), the DAO will distribute rewards via a distributor contract.
If not, the DAO will resolve any issues and resubmit a new proposal for distribution.
Rewards will be distributed in WETH and will be claimable via a rewards contract. Rewards from multiple epochs can be claimed at once, there is no need for stakers to claim every month.
The amount of PRV that can be redeemed for AUXO each epoch (redemption availability) will vary based on how the price of AUXO trades compared to the treasury net asset value (NAV). As NAV is considered to be the fair market value for AUXO, the redemption mechanism was designed to help the price stabilize around the NAV (denominated in ETH).
The system will work as follows:
At the beginning of each epoch, the price of AUXO will be assessed based on how it is trading relative to the NAV.
1.Shall the price of AUXO (denominated in ETH) trade at a discount, no AUXO will be redeemable through PRV in the given epoch.
2.Shall the price of AUXO (denominated in ETH) trade at a premium, PRV will be redeemable for AUXO proportionally to the magnitude of the premium per-se. Simply put, the larger the premium, the more AUXO can be redeemed through PRV.
In code terms, withdrawals only active in a given epoch if(AUXOETH > NAV_eth*(1 + B%))
where:
AUXOETH, is the price of AUXO denominated in ETH
NAV_eth, is the net asset value of AUXO denominated in ETH
The B factor is a parameter ranging between 5% and 50% that will act as a ‘buffer’ (hence the B) and will be selected by the treasury committee each epoch. The B factor exists to mitigate additional selling pressure that could suppress the price of AUXO into further discount.
For instance, if at the beginning of an epoch AUXO will be trading at a 50% premium with respect to its NAV, then the B factor may be chosen to be somewhere between 5% and 15%. In other words, the magnitude of the redemption of that epoch will be as big as to allow enough selling pressure to bring down the price to 5% or 15% above NAV. Practically speaking, if the entire redemption availability gets filled and organic selling pressure adds on top of if, the price may very well trade within the buffer (below NAV*(1 + B%)).
On the other hand, if at the beginning of the epoch the price of AUXO finds itself trading below a 5% premium to NAV, then no redemptions would be put in place for the current epoch. This is because, shall redemptions be activated to bring the price down to NAV, additional organic selling pressure may add up and suppress the price further in undervalued territory.
In sum, the buffer will act as an additional price stability mechanism where the higher the premium vs NAV at the epoch start, the more room there will be for PRV redemptions into AUXO.
The system described above implies that shall there be little demand for AUXO (aka, AUXO trading at or below NAV) no redemptions would be available for PRV holders until the price starts trading at a healthy premium. On the other hand however, in periods of high demand and higher price appreciation, redemption rates can turn to be quite high thus allowing PRV holders to own more liquid holdings while at the same time ensuring the price of AUXO not to trade at many multiples above its fair market value.
PRV is a fully backed future claim on AUXO which earns rewards. PRV holders bet that AUXO price will be trading at healthy levels and get rewarded for stabilizing the market when it is trading at discount to NAV by keeping AUXO away from circulation.
💡 There is no guarantee of peg between Auxo and PRV, however, those tokens are likely to be priced at similar levels.
As a final point: ARV can be converted to PRV, subject to an early termination penalty of 20%. In this case, the user’s original deposit of Auxo will be used to mint PRV, and the user’s ARV will be burned.
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