Sperax: benefiting all financial lives

Founded in 2020, Sperax is a global technology company building modern money with blockchain technology. The new auto-yield stablecoin, Sperax USD ($USDs), will make decentralized finance (DeFi) accessible to both experienced and novice crypto users.

Sperax’s mission is to build a blockchain-enabled financial system that is equitable and democratized. Sperax believes that such a financial system earns a USD stablecoin that automatically fights inflation. The team consists of goal-oriented engineers, mathematicians, marketing specialists and designers who are committed to adding transparency to the financial system.


Passive Income with 11% APY on USDs Auto Returns

$USDs stands out from other stablecoins because of its inflation-fighting Auto-Yield feature.

Collateral used to hold $USDs app.sperax.io is delegated to earn returns on Curve Finance and the earnings are automatically distributed among $USDs holders. This passive income strategy is new to the stablecoin ecosystem as it requires no user action. One simply holds $USDs and more $USDs are airdropped.

The Sperax USD tokenomics is incredibly secure and can hold a $1 peg in the most severe market conditions. Advanced arbitrage traders can always exchange 1 $USDs mint for $1 eligible collateral + $SPA and 1 $USDs for $1 collateral + $SPA. In the event that $USDs strays from the peg, the market will correct to the peg thanks to the profitable arbitrage trading.

The target return for USDs is 11% APY. Any returns earned above this figure are kept in the protocol to maintain 11% APY for $USDs holders in periods when returns are below 11%.


veSPA: $SPA Strike

Vital to $USDs is the Sperax board token: $SPA. While $SPA is used in addition to collateral to store and redeem $USDs, it is also the DAO governance token of the Sperax protocol.

To align community incentives, Sperax launched the veSPA strike protocol, modeled after the popular veCRV strike protocol. Users can wager $SPA and earn $SPA rewards from three sources:

  • Yield Share Rewards – 50% of the return generated by USDs
  • Fee Rewards – 100% of fee income from USDs mints and redemptions
  • Incentive Rewards – Strike incentives sponsored by Treasury to initiate the Strike protocol.

governance

veSPA strikers will control the DAO, vote on collateral type, return generating strategies and use treasury funds. In return, they earn the $SPA staking rewards, protocol fees and other incentive rewards

$1,200,000,000 SPA will be acquired and deposited into the DAO Treasury over the next four years. These tokens must be distributed according to DAO approval after each monthly distribution.


Extra Utility and Value Accrual for $SPA holders

veSPA, or vote-escrowed $SPA, is simply a locked $SPA. Depositing $SPA in a vault will lock $SPA to offer much more rewards compared to those who don’t wager anything. veSPA is the perfect product for the long term holder. veSPA aligns community incentives and helps $USDs and $SPA holders benefit from each other’s success. veSPA holders become active participants in SperaxDAO governance to further build $USDs, while increasing $USDs adoption ensures veSPA participants remain betting.

The veSPA upgrade adds additional utility and value accrual mechanisms (value accrual) to $SPA, in addition to the existing mechanism that burns $SPA as $USDs grows in circulation. These upgrades prove incentive alignment for holders of veSPA and $USDs.

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Strike Rewards Breakdown

By staking, strikers will receive three types of rewards. All three types of rewards are distributed using the same weekly distribution mechanism. The rewards are generated from different sources, but all rewards are distributed in proportion to the striker’s veSPA balance against the veSPA pool.

Strike incentive: More $SPA
$USDs Protocol Fees (100%): More $SPA
$USD’s auto-yield share: More $SPA

Strikers can view rewards from all three types of rewards on the dapp. Strikers should be able to view their share of the total rewards and the next rewards distribution.


Strike Incentive Rewards

This reward is the most basic, but will only be available during the protocol launch. During the token generation event, 10% of the circulating $SPA supply was reserved for staking incentives. They reserved these rewards for:

  1. Reward strikers without blowing up the total $SPA supply
  2. Bootstrap the $SPA rewards because the protocol doesn’t collect huge usage costs yet
  3. Decentralized $SPA Companies

This budget is finite. Once this budget is exhausted, the DAO will have to vote to allocate $SPA from the Treasury to replenish this $SPA flow.


Protocol Fee Rewards

$USDs charges for users who store or exchange $USDs. These protocol costs benefit SPA strikers (ie users with veSPA). With fees collected from the $USDs protocol, the strike protocol buys $SPA in the open market. This purchased $SPA is distributed among all veSPA holders.

Therefore, increased USD usage and arbitrage strategies result in more fees collected, benefiting veSPA holders with higher rewards. This buyback feature links $USD’s growth to buying pressure for $SPA as more rewards are paid out to veSPA strikers


$USDs Yield Share Rewards

A fraction of the automated yield generated by $USDs will be exchanged for $SPA tokens on the open market and distributed to veSPA holders. This buyback feature links $USDs TVL to constant buying pressure for $SPA as more rewards are paid out to veSPA strikers.

Instead of re-bombing and burning all revenue, Sperax will only reallocate and burn (1- profit sharing parameter) * total revenue in $USDs. The remainder of the proceeds (ie profit sharing parameter * total proceeds in $USDs) will be combined with the protocol fees and incentive rewards to be exchanged for $SPA using the Uniswap v3 $SPA / $USD pool at regular intervals.

When minting $USDs, up to 1.5 cents (usually less) is used to buy back $SPA. With Yield Share Rewards, there can be an additional 3.5 cents of $SPA redemptions every year for every $USDs minted. Assuming a consistent TVL, this yield share translates to over 20x more $SPA to be bought over 10 years. This directly links levels of $USDs TVL to value building for $SPA.

The profit sharing parameter could be chased through governance in the first iterations. Future versions could include a dynamic in-chain profit-sharing algorithm that will further stabilize strike returns.

For more information on Sperax’s exciting project, visit: https://sperax.io/https://docs.sperax.io/ and https:// medium.com/sperax

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