Equilibrium

5 min readOct 29, 2021

Taking farming to the next level.

Please, mind that nothing herein shall be considered as financial advice, and no guarantee whatsoever is given herein. Do your own research. Use at your own risk.

Introduction

Yellers, we are HYPED AF to announce that Equilibrium is right around the corner. Just to remind you or, if you haven’t heard of it, Equilibrium is a master contract for active portfolio management created by mad scientists from Yel Finance, who have been given a diagnosis of high APRs addiction. Being badly sick, the mad scientists decided to be the first who would convert the high APRs into crazy APYs by creating a smart contract that would constantly monitor yield farming opportunities of various risks to provide liquidity and farm the most profitable strategy out there; compounding and migrating profits according to the set strategy. We have taken some time, collected the best strategies and farms out there, and finally brought our community a killer in terms of fees generation. The strategies will be added constantly and we as usual encourage our community to propose and vote on adding their strategies. Just to add, we think we are the first ones to do that, aren’t we?

User Story

User deposits a native network token depending on the network chosen between ETH, BSC, POLY or FTM (for example, users deposits BNB to Equilibrium operating on BSC Network), and chooses the strategy risk level, either safe, medium or risky. The higher the risk level, the higher the APYs.

Once the deposit is completed, the user is accounted for a share of profits based on that user’s share of the total Equilibrium pool within that Network. Equilibrium monitors and evaluates all farms for the chosen strategy, taking into account: liquidity depth, trading volumes, fees earned for LP and farming rewards.

Once the most profitable opportunity is defined, Equilibrium swaps the original deposit to the required pair to join the pool, and received LPs are automatically placed into the farm. The contract will be auto-compounding, meaning that the contract will regularly sell half of the received rewards for the needed pair token and allocate it to the liquidity. If a new farming opportunity presents itself that is more profitable within the chosen strategy, Equilibrium will automatically reallocate all deposits to the new farming opportunity.

Whenever a user wants to withdraw the funds, the Equilibrium contract will harvest all the rewards and unstake deposits, convert profit to YEL token on the operating network, collect the performance fee and pay back the user with initial deposit together with profits. Repaying to the user in YEL will create additional buy pressure on YEL, as the contract will buy YEL out of the market every time a user wants to withdraw his deposit.

The performance fee shall be set at the rate of 15% and applied only to profit gained, excluding the initial deposit. Collected fees will be used to cover YEL enhanced farms, incentivization programs, lending rewards and for other token economies purposes.

Strategies

Our analytics led by the vision of Mr Pool Day have created 3 different types of strategies, and sources the DeFi space for farms, that match the criteria of one of the three strategies. Currently there are more than 65 farms across 3 different networks deployed in the Equilibrium with ETH farms soon to come. Below you can access some basic information on each of them.

Stakeholders

Equilibrium stakeholders are all in the win-win situation, thus we expect Equilibrium to gather a greater community and partner network around Yel Finance.

Security

We take our security pretty seriously in Yel Finance. Currently the Equilibrium V1 is undergoing an audit within Solidity Finance, our long term trusted partner. We have already performed various manual and automated tests, as well as asked our partners and high-expertize devs in DeFi space to audit it also. Furthermore, periodic audits for the Equilibrium are planned to be executed to constantly monitor our safety. Beta version of Equilibrium is available at users’ own risk, as decided by our DAO.

Financial Modeling & Forecasts

We have modeled the performance of the Equilibrium assuming that per each network the total deposits will be as low as USD 2,000,000.

Please, mind that modelled deposit per network is a pessimistic scenario. Realistic assumptions and market size presumes for the deposit per each network to be USD 14,000,000. Also, ETH network will be added after the respective farms and strategies undergo a due diligence, audits, modeling and testing.

Furthermore, the deposit in amount of USD 2,000,000 we suppose shall be split by the type of risk strategy chosen as follows:

As the Equilibrium will auto-compound the deposit in the farms, we have calculated the APY for the respective periods mentioned below and calculated it’s performance.