WHEAT Tokenomics: Sustainable Yield Farming

WHEAT Tokenomics

WHEAT is the token used to incentivize the products of the GrowthDeFi ecosystem. In exchange, a large portion of the revenues are directed towards buybacking and burning it, the ultimate goal is to make WHEAT deflationary.

Contract Address (BSC):
0x3ab63309F85df5D4c3351ff8EACb87980E05Da4E

Initial Liquidity:

10,000 WHEAT matched with 200 BNB for the initial liquidity.

Emission rate:
0.1 WHEAT/block

Emission distribution:

100% of the WHEAT emissions go towards incentivizing farmers.

There is a 0% team allocation for the emissions.

The short term and long term goals of WHEAT:

Throughout the earliest launch period the emissions of WHEAT are used to incentivize users to deposit their LP tokens into the protocol, the purpose of this is to quickly accumulate large balances in the Fee Collector contracts that constantly buyback and burn WHEAT.

The longer term goal for WHEAT is having emissions of it to continually incentivize the different products offered whilst being deflationary, deflation in WHEAT happens when the buyback contract is buybacking and burning more WHEAT than the emission rate at the time.

WHEAT’s unique sustainable model:

The typical farming uses up any existing revenues to automatically buyback the token, however the point in time where the protocol is making the most revenue is usually also the point at which the token price is the highest, this makes the effective buyback amount negligible compared to the tokens being issued.

When the price of the token eventually crashes down so does the TVL/volume of the protocol and as a direct consequence the revenue of it, the result is that no matter the current state of the protocol it never has enough revenue to buyback more than what it’s issuing.

This is where WHEAT innovates:

WHEAT’s main revenue source comes from deposit and performance fees, the deposit fee builds up the balances of the fee collector contracts very quickly and the user is less likely to withdraw their funds if there is a deposit fee.

The performance fee capitalizes on the higher likelihood of TVL staying within the protocol and generates a more consistent revenue source.

Deposits Fees

Performance Fees (Very reliable)

In the case of PancakeSwap strategies this fees are paid in LP tokens, they go to the fee collector contract which in turns harvests CAKE regularly and uses it to buyback WHEAT & GRO.

As a result of this setup the amount of WHEAT being bought back is dependent on the profits generated by all the fee collector contracts, not the direct revenue of the protocol.

This leaves three scenarios depending on what the price of WHEAT does:

Scenario 1 (WHEAT’s price goes down)

Consequences:

-Less Deposit & Performance Fees (Note that even if it’s less it’s still constantly increasing since the LP tokens aren’t used for buybacks, only the CAKE it farms).

-Swap fee growth remains the same

-Amount of WHEAT being bought back up increases inversely to the price drop, example: If all the CAKE being collected is buybacking 3,000 WHEAT/day and the price drops 90% then Buybacks are 10 times more effective and it’d now be buybacking 30,000 WHEAT/day , this is why it is important to have an uncorrelated buyback source to the price.

Scenario 2 (WHEAT’s price stays flat)

Consequences:

-Consistent growth from Deposit & Performance Fees

-Swap Fee growth remains the same

-Amount of WHEAT being bought back up increases overtime as a result of the increase in the balance through deposit/performance fees and the swap fee growth.

Scenario 3 (WHEAT’s price increases)

Consequences:

-Substantial increase in Deposits & Performance Fees

-Swap Fee growth remains the same

-Amount of WHEAT being bought back up goes down but its buybacking power increases faster than in the other scenarios, making it better prepared for when the price stays flat (Scenario 2) or starts dropping (Scenario 1).

The goal of WHEAT is sustainable farming, growth over the long term and being able to incentivize the products of the Growth DeFi ecosystem.

Core Pairs

The following are the core pairs which are incentivized with WHEAT, they have a 0% Deposit Fee:

WHEAT/BNB (30x)

WHEAT Staking (15x)

GRO/BNB (3x)

gROOT/BNB (1x)

GRO/gROOT (1x)

PancakeSwap Strategy Tokens

This type of strategy tokens focus on harvesting CAKE and compounding it into more PCS LP Tokens to maximize returns in the long run.

The user’s position is represented in tokenizing shares of the contract holdings, these tokens can be staked to farm WHEAT.

The fee setup for PancakeSwap Strategy Tokens is as follows:

Deposit Fee (0.1% total)

0.083% Fee Collector

0.017% Platform Fee

Performance Fee (50% total)

50% Fee Collector

This are the current supported pairs for this strategy and their current incentives multiplier, more will be added overtime:

CAKE (15x)

CAKE/BNB (15x)

BNB/BUSD (7x)

BTCB/BNB (3x)

ETH/BNB (3x)

LINK/BNB (1x)

UNI/BNB (1x)

DOT/BNB (1x)

ADA/BNB (1x)

USDC/BUSD (1x)

DAI/BUSD (1x)

UST/BUSD (1x)

Fee Collectors

For every strategy token there is a Fee Collector contract, its functions are to collect the fees, stake them in the corresponding contracts to generate a return and sending the profits to the main WHEAT Buyback Contract.

Here is an example on how it works taking the PancakeSwap strategy token for CAKE/BNB as an example:

1-The Fee Collector contract receives the deposit and performance fees from the CAKE/BNB strategy contract, this fees are received in the form of CAKE/BNB LP tokens.

2-The Fee Collector contract stakes the CAKE/BNB LP tokens in the PancakeSwap MasterChef contract in order to farm CAKE.

3-It harvests the CAKE and sends it to the WHEAT Buyback Contract.

The TVL in a Fee Collector contract increases in three ways:

-Deposits & Performance Fees increase its LP token balance

-Swap Fees increase the worth of each LP token

-If the underlying tokens in the LP appreciate so does the LP token

WHEAT Buyback Contract

This is the contract that concentrates all the profits sent from all the Fee Collector contracts of each strategy, in the case of PancakeSwap strategies it receives CAKE.

These are the steps that the contract follows with the incoming CAKE:

1-Convert it to WBNB

2-Buyback WHEAT and burn it with 70% of the WBNB.

3-Buyback GRO and burn it with 15% of the WBNB.

4-Inject 15% of the WBNB into GRO Yield.

Feel free to read more about WHEAT and the GrowthDeFi ecosystem at docs.growthdefi.com

If you have any questions you can join the Telegram group and ask.