Launch Hundreds of Emissionless Farms Rapidly

After having a discussion with bwar, 0xanon, and viscanti yesterday on Discord, I would like to better propose a DegenZone (different name of course) within Pickle Finance.

These farms in the DegenZone would not be allocated any Pickle emissions and would have fees be restructured to something like a 5% to 10% performance fee and a 0% to 1% withdrawal fee.

It seems to me that Pickle Finance is working towards a dual product model. The first product being a highly engineered, gas optimized industrial compounder/aggregator and the second product being lending and stablecoin issuance a la Abracadabra.

This DegenZone would introduce a third product: unoptimized, possibly gameified, lazyape autocompounding.

In broad strokes, this DegenZone would:

  • Serve as an automated compounder for various yield farms that we are currently not capturing
  • Create early partnerships with more teams from more diverse development backgrounds (not a bad thing with some basic vetting and good communication)
  • Dramatically increase TVL and improve marketing
  • Bring in pure revenues without interfering with current tokenomic models
  • Greatly improve our multi-chain presence and create a strong foundation for future, more serious development, on those chains
  • Better organize current jars (not to trample on any partnerships but things like DINO & Cherry probably belong in the DegenZone)

It would essentially be a competitor with the various current yield aggregators that exist today such as beefy.finance, grim.finance, eleven.finance, autofarm.network, arbis.finance and so many more.

These different protocols all do essentially the same thing: autocompound yield farms. It’s a simple service, but somebody’s gotta do it. Might as well be Pickle.

Despite the simple service, the TVL in these protocols is large and is earning significant revenues via performance fees and deposit/withdrawal fees.

For example, beefy.finance’s fee structure is currently set up with an indiscriminate 4.5% performance fee and a variable withdrawal fee usually between 0% and 0.1%.

Beefy Vaults:

BSC - $324m TVL across 261 vaults

AVAX - $191m TVL across 71 vaults

HECO - $860k TVL across 29 vaults

Polygon - $129m TVL across 134 vaults

FTM - $400m TVL across 105 vaults

ONE - $3m TVL across 17 vaults

Arbitrum - $48m TVL across 12 vaults

CELO - $13m TVL across 6 vaults

MOVR - $8m TVL across 21 vaults

Cronos - $6m TVL across 6 vaults

Total - $1.12B across 662 vaults

Even with minimal fees, over a billion USD of TVL is significant which could go straight into the treasury and to DILL stakers. Furthermore, creating 662 vaults across 10 chains, as in Beefy’s case, is sure to dramatically improve Pickle’s presence and partnerships. Granted, these partnerships would likely not be of the same quality as say Spell, Curve, or Convex, but they are partnerships nonetheless that would also improve marketing.

Fundamentally, the TVL in these protocols is not very sticky. The service that they provide is not very innovative in its base form and can be easily performed by anyone else. So why would anyone deposit money with one protocol versus another if the service is identical and the fees are roughly the same? Brand.

I believe that Pickle is uniquely positioned to dominate the autofarm shitcoin market because of its brand. A safe, secure place where apes could farm every shitcoin under the sun within 1-2 days of the farm dropping with the backing of the Yearn ecosystem.

While such a product might not seem attractive to professional bigbrain devs, the market is undeniably there and there is nowhere else in the Yearn ecosystem where this huge market is addressed other than perhaps if a shitcoin decides to use Sushi as the AMM.

What makes the DegenZone attractive is that being emissionless, they do not affect current tokenomics and they can be deployed much faster without SCCOC involvement in management of said emissions. The contracts would also be relatively easy to build/fork and don’t have as many security risks due to their simplicity (even a noob like me could put it together with some patience). Honestly, you really don’t even need to have the PICKLE token on said chain to start farming since being emissionless, there’s no need for PICKLE liquidity to sell. Just send fees back to ETH.

It would add a whole new rapid-release arm to the Pickle protocol to create more growth while more seriously engineered products are built.

Some reasonable questions:

Ok, but how big is this market really?

Besides Beefy’s stats above here are some other competitors’ TVLs in this space at a quick glance:

Autofarm.network: $464m across BSC, HECO, Polygon, AVAX, FTM, MOVR, OEC, CELO, and Cronos

Snowball.network: $83m all on AVAX

Grim.Finance: $70m all on FTM

Eleven.finance: $49m across Polygon, FTM, BSC, AVAX, and OEC

Are there any worthwhile farms?

That depends on the definition of ‘worthwhile’. Are we going to find farms of a similar quality to Curve? Some, but not many.

There’s definitely alot of low quality coins being farmed in these projects, but that shouldn’t matter. We provide a simple service that only has a positive effect on Pickle’s finances. One ape’s scam is another ape’s treasure. Just look at Doge and Shib.

But yes there are worthwhile farms that we could be capturing.

On Polygon alone, Beefy has vaults such as:

In this example, Is it worth deploying a farm to capture $11m of wBTC/renBTC earning 3.25%? I would say it’s better to have it than to not have it. Whoever has deposited into a pool like that is probably not going to be moving it very much. He’s just looking for an easy way to avoid having to manually compound once a week, and Beefy has convinced them that 4.5% performance fee and a 0.01% withdrawal fee is reasonable. Something as simple as a better brand loyalty and some NFTs could convert that TVL over to Pickle all else being equal, which even if it’s not incredibly profitable, is still nice and good for ‘numba go up’ marketing.

There are many more farms on other chains we are not live on yet such as BSC and AVAX.

By deploying rapidly with smaller overhead onto new chains, we gain an early foothold for future development. At this point we are not early on BSC nor AVAX nor FTM, however, we would have been if we had emissionlessly farmed there months ago with a lite deployment similar to what Sushi did with their multichain strategy.

Let’s take a look at some up and coming chains: Moonriver and Cronos. Both of these chains are still early. A lite deployment here would capture some attractive farms.

Using Beefy as an example again, here are their top Moonriver farms:

Should we allocate emissions to a SOLAR-MOVR farm on Solarbeam? Probably not, but there’s no reason not to allow others to autocompound with Pickle instead of Beefy. Solid revenue with little downside. There is a strong market here, be it short term or not. In comparison, Beefy has more vaults on Moonriver than Pickle has on Polygon. I think that could change with lite emissionless farm deployments.

How about Cronos?

CRO might be a good coin. The app is smooth and I’m already using it more than Coinbase because it has straight to Sidechain/L2 transfers. And CRO is a nice DeFi to CeFi bridge. I can farm CRO onchain, move it to Crypto.com, stake for 6 months, and then have a crypto credit card mailed to my door with better perks than almost anything in Tradfi.

Do I want exposure to VVS? Not me, but maybe somebody else does. I’ll take a CRO-ETH or a CRO-BTC pair at 5k% APY happily though. Beefy is already here and I think Pickle could be too.

Are we ready to hop onto NEAR or Gnosis or whatever else comes next? Could we outperform Beefy on the frontiers of DeFi? I think so if we paid a little bit more attention to this market.

What are some big challenges?

I think one of the biggest challenges is the Pickle brand itself. While I think that Pickle, as a psuedo-memecoin could incorporate a DegenZone, it undoubtedly creates a shift in the current direction Pickle is heading. Users need to understand that DegenZone farms are degenerate. You can farm them, but they are closer to games than real investments. I think Olympus actually pulled off this shift nicely with their Pooltogether lotto.

Pretty clear pretty quick that you’re looking at something different now.

I think creating a filtered list of all the farms (similar to what we have currently) and reskinning it with the original Pickle Rick bouncing around background is adequate to create that impression via styling and still maintain the Pickle brand well.

Other challenges I foresee would be community coordination. Working with so many different shitcoin protocols would probably require a good bit more communication management (anybody speak Mandarin?)

Of course it would take some time to develop and test the contracts even if they are relatively simple.

Besides that I think there are many more upsides than down.

Is this approach conducive to protocol friendly farming?

Yes, I think it can be. Especially with Pool2s, compounding into more liquidity for the protocol is not malicious. I also think that it could be a good option to incubate certain projects, perhaps even develop an incubator at some point in the future.

A good example of this would be with grim.finance and scarecrow.fi. SCARE is essentially a game farm that has no real product or point. It’s gameified ponzinomics to create yield while the token dumps. In my opinion, that’s fine as long as that is clearly communicated. Grim came in and helped SCARE implement a timelock and secure a multisig soon after their launch to improve the security of the farming game so the devs didn’t ‘accidently’ rug their users, creating a better farming experience. I think Pickle could do this at some point in the future and create a stronger network overall.

There is also an advantage for being early in partnerships with projects that develop well. For example, FTM-BOO and FTM-SPIRIT on Fantom would probably be in the DegenZone if we had deployed there in May. Now, their farms might even deserve Pickle emissions (perhaps even using their LPs as collateral one day???). However, having already been compounding with them like Beefy has been would be advantageous for that partnership by having their liquidity with us.

What does the future of DegenZone look like?

When the bear market eventually does come, the majority of the lower quality farms will probably go to perma 0. However, that doesn’t mean that they can’t be farmed for now. Selling shovels in a gold rush.

There will probably be many of these coins that also rug and/or fail for unrelated reasons as well. Being in a separate category called the DegenZone, I think the experience, rugs included, could be gameified (lol). A rapid cycle of short-medium term farms for degens with some gems here and there rising up the ranks into sponsored farms with PICKLE emissions.

Got burnt on a 2.5T% apy farm? Here’s a nice consolation NFT by Fennec.
“Grats on the losses, welcome to DeFi. We’re soooo early”

Perhaps, as 0xanon mentioned on Discord yesterday, something like Grim’s feeless weekend farming specials would be nice marketing. Maybe some Pooltogether lotteries like OHM?

It also creates a nice foundation for more serious development in the future, like maybe leveraged farming like Alpaca or Tarot? It doesn’t really matter, there are many possibilities. The bottom line is that the market is there and nobody else on bluechip development teams is even looking in that direction.

As a bunch of Pickles, I think we could be uniquely positioned to span the full spectrum of DeFi farming from pure degeneracy to institutionally viable solutions.

In conclusion

Obviously the DegenZone isn’t a hugely innovative bigbrain DeFi magic product. It does, however, have many benefits as listed above and relatively little downside. The only real problem is handling the brand, which I think Pickle, being a meme in and of itself, could incorporate in a way that YFI could not. Even YFI has launched woofy to try and capture the degen retail market better. I think Pickle is already 80% of the way there to be a real competitor to Beefy and put other protocols like Eleven out of their misery.

The greatest advantage besides the free revenue to the treasury and DILL stakers is the early mover advantage. For many of these newer chains like Moonriver and Cronos, the yield aggregator market is immediately moved to Beefy and chain specific projects like Grim. If Pickle could move faster with emissionless lite deployments, a better brand with a better holistic product portfolio would capture huge swaths of these markets and create a stronger foundation for future development.

Ultimately, I think this is a relatively low effort/medium-high reward strategy for the medium term. By no means do I think it should detract from the current trajectory of development at Pickle, but rather I think it incorporates a new independent product that could really spur alot of growth in the protocol. Of course it’s just a suggestion, but I hope it is useful enough to create some discussions about the ideas described in this proposal if nothing else.

Sorry for the length, thanks for your time.

~ amatureApe

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for those not using discord - the discussion is there

This is a good writeup.

My remarks from discord: I think a small step towards more degen farms could be good. However, I see value in Pickle farms being relatively safe and curated.

I think the more important goal is to make DILL contract reach other chains and handle more farms. Bwar’s remarks about streamlining are important. Once this is ready, there will be no need to deploy farms outside of the DILL scope.

I don’t see a particular need to reduce fees. Abandoning the DILL concept would be a large pivot in the protocol strategy.

Thanks so much for the detailed write up @amatureApe :pray:

I agree with your take that a first mover advantage on new chains could be paired very effectively with the strong Pickle brand (as we’ve seen Beefy and Sushi do with consistent moderate success).

I agree with positioning such a product as distinct and separate from the rest of our farms which revolve around DILL. I think an “experimental zone” gives us a nice carte blanch to target potentially fleeting opportunities which could be great earners. Those that stand the test of time (like SPELL-ETH for example), they could easily be promoted and those that don’t can easily be phased out. I’m hesitant to change our fee structure too much as the degen farms are great earners with the performance fee model. I prefer the approach of reducing fees down to 10% until PICKLE rewards are incorporated for them (as we’ve done on OKEx - and applicable to DegenZone farms on mainnet as well).

Interestingly, I’ve prepared a number of Jars on Harmony which are ready to go (just Sushi for now), but opted to wait for more farming opportunities before making a bigger coordinated launch with potentially co-incentivized ONE and PICKLE rewards. However, I’m open to testing your hypothesis and see if launching early would yield positive results (though I’m aware that Beefy already beat us to the punch there, so this might not be the best test case).

All in all, I’m all for ideas which help Pickle move faster and enable capturing as many revenue streams as possible :rocket:

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Thank you for your feedback and your open-mindedness to the idea @Larry_Cucumber

I believe that the DegenZone would make Pickle a more robust protocol, essentially turning it into a three-pronged project, spanning the full gamut of DeFi yield solutions:

Interest bearing lending which would rival Abracadabra, industrial grade yield aggregation which would rival/complement YFI, and degen farming which would rival Beefy.

From my outside perspective, there seem to be strong synergies that could be built between these three branches over time while also benefiting from a first-mover advantage. One such synergy could be to deposit an ETH/BTC pair, borrow GREEN against it, and use that to go farm in the DegenZone while all the fees went to DILL stakers, putting buy pressure on Pickle and boosting the yield paid out to emissioned farms.

Especially being part of the Yearn ecosystem, I imagine that with the DegenZone we could follow Sushi virtually everywhere in their multichain strategy and provide automated compounding for basically all of their LPs which are not obvious hard rug scams, potentially giving Pickle access to a large portion Sushi’s total liquidity which currently sits at $4.13B.

Additionally, with the proper branding/marketing and perhaps a little incentivization on Sushi’s part, I think it would be possible to convert the vast majority of Beefy’s sushi farms over to Pickle.

These figures are currently:

Polygon: $10.4m across 23 vaults

Arbitrum: $17m across 7 vaults

Harmony: $3.5m across 16 vaults

While these figures may not be much currently, I see no reason why Beefy should have them over Pickle.

Regarding the fee structure, ultimately the question becomes whether Pickle’s brand is worth more than Beefy’s and by how much. At a 10% performance fee, Pickle’s brand would have to be worth more than double Beefy’s to be competitive with Beefy’s 4.5% performance fee. While I do think this is certainly possible with a more developed brand and strong synergies with the other products in Pickle’s suite and the broader Yearn ecosystem, I think being the new kid on the block with higher fees is going to be a tough prospect, at least initially.

For example, in the 20 hours since I originally posted the thread, Beefy has released 12 new vaults on Cronos. Again, I’m no expert, but from my impression that TVL may be hard to convert on brand alone given that Pickle’s fees would be more than double Beefy’s at this stage.

In my opinion, of course not being privy to the inner discussions of Pickle’s working groups, it may be more prudent to initially release with low fees that are competitive with Beefy’s and then incrementally increase said fees as the Pickle brand and suite of products grow to a 10% performance fee (or even higher).

Maybe even a structure as such:

  • 5% performance fees for low-quality unpartnered DegenZone farms
  • 10% performance fees for medium-quality partnered DegenZone farms where we are more confident of the stickiness of the TVL
  • 20% performance fees for high-quality farms with close partnerships which include Pickle emissions
  • 25% performance fees for top-quality farms which may be used as collateral for lending

Again, not knowing anything about what Pickle has planned behind the scenes, perhaps this multi-tiered fee system might capture the best of both worlds where we are competitive with players like Beefy and earning healthier performance fees on better farms.

These are just my initial thoughts regarding the matter. I hope they are useful for you and the Pickle team. Thanks again! I really appreciate everyone taking time to consider my idea.

I must say that I was initially skeptical, because deploying large amounts of farms outside of the scope of DILL would be a new path.

However, after looking at Beefy farms, I can see what you mean. I think it would be positive to deploy loads of degen farms with 10% fee, then over time select some curated ones and pull them under the scope of DILL.

As in the recent poll in dilldao channel, some users pick their investments based on what Pickle deploys as farms.

I see no harm in deploying a lot of farms, saying “these are risky” and over time pulling some into our main menu.

If we took this approach, we could have hit the DINO-ETH pool with 1330% APY on Quickswap which is strangely missing from our menu :slight_smile:

@Larry_Cucumber Harmony launch sounds great, can we launch sooner rather than later to see what happens plz? :slight_smile:

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I love this proposal and I firmly agree with the vision you have for Pickle Finance moving forward. I hope we can move forward with this!

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