To all newcomers, welcome to Value DeFi. We are a decentralized finance protocol, devoted to make DeFi safe, accessible and profitable for everyone.
The Governance Vault is the foundation of Value DeFi’s ecosystem where users ‘stake’ their tokens safely for a variety of benefits, most notably rewards. Today this article will address all the components and benefits of staking your VALUE in Value DeFi’s Governance Vault.
Topics of Discussion:
- Governance (voting)
- Auto-compounding rewards
- Profit-share and Buybacks
- Idle funds being utilized in other farms
- Start Staking
If you stake in our Governance Vault you have the opportunity to decide on important decisions through Votes. We label these votes as VIPs, and often include topics such as reward rates, additional pools to open, profit-share rates, etc. Your weight of your vote is determined by the size of your VALUE holdings. You can find the Votes page by clicking the ‘Vote’ button on our homepage, or by following this link: https://valuedefi.io/voting
Stakers in the Governance Vault receive a shared amount of $VALUE tokens which are a set amount per Ethereum block. We define these as as emissions. Currently the Governance Vault receives 0.2 VALUE / Block, which equates to approximately 1300 VALUE per day split amongst all stakers.
Conventional Vaults accumulate rewards for you ‘on-paper’, but to actually receive these rewards into your wallet you need to claim them. Additionally, those wishing to re-stake rewards to accelerate profit need to claim and deposit those rewards again. That’s two transaction for every re-stake, something that can be very costly and decreases profits.
At Value DeFi, we have designed a very elegant system that maximizes returns. Our system significantly reduces gas costs and enables users to receive accelerated rewards, opposed to standard reward distributions by using our gvVALUE token system (more below).
Also, the latest addition to the Governance Vault is a publicly usable button that allows any user to call the auto-compound function for emissions. When one user presses ‘Call Compound’, emissions are deposited directly into the Governance Vault for all users. This button calls the minting function that is responsible for creating and distributing Governance Vault emissions.
Note: There is no downside to spamming this button, only gas costs for the user using the button, as rewards are set per block. You can claim every second or once per day and the rewards would end up being the same.
gvVALUE is the compounding interest token of the Governance Vault. When you deposit VALUE to stake, gvVALUE is automatically generated and issued to you. These are your Governance Vault tokens of ownership, representing your share of the Vault. Instead of being required to claim rewards, they are immediately deposited back into the Governance Vault, and your ownership tokens (gvVALUE) represent your share of the additional rewards.
gvVALUE may seem like a convoluted system, but its just simple mathematics designed to save users on gas fees and increase profits.
At the start, 1gvVALUE = 1VALUE.
Whenever emissions or profit-share from Value Vaults and Value Liquid are rewarded (harvested), they are deposited directly into the Governance Vault. Therefore, there is now more VALUE compared to gvVALUE, increasing the underlying price of gvVALUE when converting back to VALUE.
Example for gvVALUE : VALUE:
Think of a group of 10 people (gvVALUE) each having $10 each (VALUE). 10people : $10, therefore a pool of $100. The group harvests a $10 reward. Since the number of people (gvVALUE) did not change, they each receive a split of the $10. (10people/$10 = $1 each). After adding this $10 to the pool, the total becomes $110. Therefore, the result is $11 each. Meaning 10people : $11 or 10gvVALUE : 11VALUE.
The rewards increase proportionally, so regardless of other users leaving the Governance Vault, your rewards are not affected. As time progresses, gvVALUE continually grows meaning you receive less when depositing your VALUE. However, this slight decrease does not significantly effect your rewards. The key to maximizing profit is duration staked.
Example of Rewards:
At the time for a new deposit; 1gvVALUE : 1.1VALUE, then on a stake of 1000 VALUE you will only receive 909 gvVALUE tokens. A few weeks later you wish to exit and the ratio is now 1gvVALUE : 1.3VALUE. Therefore your 909 gvVALUE ownership tokens are now worth 1.3x when converting back to VALUE. Equalling 1181 VALUE, a profit of 181 VALUE.
Profit-share and Buybacks
As we build more products, such as Vaults, the long awaited Rebase Lending platform and when FaaS becomes mass adopted, the Value DeFi Ecosystem will grow exponentially. As the ecosystem becomes more developed, more revenue is generated for Governance Vault Stakers. All profit-share fees are used to buy circulating VALUE on the open market, generating buying pressure.
Value DeFi will become a self-sustainable source of constant buying pressure. Once emissions end, the price of VALUE will naturally rise as buybacks continually grow without any inflation or balancing selling pressure. Buybacks will slowly reduce the circulating supply, and Value DeFi will snowball. As ecosystem growth results in increased buybacks which feeds directly back into ecosystem growth.
Value Vaults Profit Share
For all rewards generated through Value Vaults, 14% of profits are used to buyback circulating supply, which are then deposited directly to the Governance Vault. Increasing the value of gvVALUE and creating buying pressure on the open market in the process.
Value Liquid Profit Share
The Governance Vault receives 33% of all swap fees generated from Value Liquid, our own decentralized exchange. Exactly the same with Value Vaults, this process creates buying pressure and increases rewards for Stakers.
Idle funds being utilized
Deposited VALUE tokens are used to farm other protocols, where the rewards are sold to buy more circulating VALUE (more buying pressure). This technology is ready, but we are hunting for a new safe and profitable farm to deploy these funds. This will noticeably increase rewards APY% for Stakers.
To start putting your tokens to work to earn rewards and other Value DeFi Staking benefits, simply go to the link below and connect your wallet, then deposit. It’s that simple.
If you’re a new user and need to purchase some VALUE tokens, click the link below to go directly to Value Liquid (Value DeFi’s built-in DeX).