Decentralized Leveraged Yield and Liquidity Aggregation Protocol LianGuaicman
LianGuaicman Decentralized Leveraged Yield and Liquidity Aggregation Protocol
LianGuaicman is a decentralized leverage yield and liquidity aggregation protocol running on Arbitrum and zkSync. Therefore, LianGuaicman Finance is a community-driven project where token holders can vote on changes proposed by the protocol to ensure transparency and fairness. All performance fees will be allocated to VeLianGuaiC token holders who hold governance permissions. LianGuaicman leverage liquidity mining is supported by a powerful incentive system, CFOO (a unique veTokenomics system combined with multi-liquidity leverage yield mining provided by SushiSwap, UniSwap, and Ve (3,3) permissionless liquidity markets).
Mechanism Analysis
LianGuaicman Finance does not rely on the principle of a decentralized exchange but provides multi-liquidity leverage liquidity mining by combining multiple liquidity pools and utilizing them to maximize returns. Popular DEX platforms on Arbitrum such as Uniswap, Sushiswap, and ZyberSwap offer different liquidity pools with different returns and risks. LianGuaicman Finance will open leverage positions on the ETH-USDC pair for each high-volume DEX to ensure sufficient demand in the liquidity pool (the reason for initially adding WETH_USDC is that this currency pair typically accounts for 50% of the liquidity in most DEXs). The decision-making process for determining new DEXs and currency pairs is currently complex. However, in the future, the community will participate in the governance process, including voting to support or oppose proposals submitted by veToken holders.
Due to the different governance models used by most decentralized exchanges on Arbitrum, LianGuaicman Finance will be used as a middleware layer to provide decentralized liquidity mining services for regular users. The advantages are:
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The fee share of LPs will be dynamically adjusted to achieve optimal liquidity level
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The protocol can bribe veP holders to obtain permanent liquidity at a low cost
LSD Finance
LianGuaicman is committed to building a permissionless DeFi product for LSD liquidity collateral tokens on Layer 2.
LianGuaicman allows assets to be transferred from Layer 1 to Layer 2 through the Arbitrum bridge or the LayerZero bridge. The low transaction fees and high network performance of Layer 2 will help LianGuaicman efficiently build decentralized financial products based on LSD (liquidity collateral derivatives) collateral assets.
Goals
Develop a platform that can meet the needs of LSD holders and other LSD-related protocols
LSD holders
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Low-risk, high-yield
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Reduce the cost of pledging and using LSD assets
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Obtain DeFi yield exposure by retaining the liquidity of their assets
Other LSD related protocols
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Provide deeper liquidity for LSD assets
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Provide a composable DeFi ecosystem for LSD assets
LianGuaicman has developed a comprehensive LSD staking+ leveraged trading+ bribery system by using the stake-vote-bribery-leverage–mining process. LSD stakers can earn interest income and token staking rewards in the ecosystem, as well as receive bribes from other LSD projects.
The model’s revenue comes from loan interest, subsidies from other LSD protocols to oLianGuaiC, bribery from other LSD protocols, and the LSD treasury.
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Lending interest: When LSD assets are added to the lending module, the staking-LSD-ETH+ETH leverage trading pair will be added to the leverage. Users who stake LSD and ETH can earn transaction fees generated by the leverage trading pair.
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Subsidies from other LSD protocols to oLianGuaiC: In the early stages of the project, LianGuaicman will provide subsidies to all users in the Stake module to increase the depth of protocol liquidity. Users who hold veLianGuaiC can earn more protocol income.
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Bribery from other LSD protocols: With the emergence of more and more LSD-related protocols in the market, they need LSD/ETH liquidity. The LianGuaicman protocol can effectively help them improve their initial liquidity. Each protocol can add additional subsidies to a single staking pool in the bribery.
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LSD treasury: LianGuaicman aims to provide sustainable, long-term returns on LSD assets to investors while increasing the asset utilization of the lending module. In addition to ensuring stable loan rates and asset security, LianGuaicman will also launch lock-up products with durations of 7 days, 14 days, and 30 days to further optimize asset utilization.
C&FOO (Controlled and Fungible Ownership Optimization)
LianGuaiC is the native incentive token of LianGuaicman, used to incentivize liquidity providers for LianGuaicman’s leveraged liquidity mining. LianGuaicman has built a ve-tokenomics system based on Curve and FOO (Fungible Ownership Optimization) using VeLianGuaiC (voting power token) and oLianGuaiC (option token) to reduce the frequency of farming and dumping scenarios and provide long-term liquidity.
LianGuaicman Finance is based on the improved FOO model. It introduces the Ve (3, 3) governance model to become C&FOO (Controlled and Fungible Ownership Optimization), eliminating barriers for users to participate in governance and improving the reliability of the protocol.
Highlights of C&FOO innovation:
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Improving the veLianGuaiC model to have trustworthy governance, reasonable unlocking mechanism, and native tokenization.
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C&FOO retains the exchange protocol based on LianGuaiC and oLianGuaiC tokens, imports a formula with variable execution price, and determines the discount rate based on the current market conditions.
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Providing a discounted IDO investment rate for Ve-Token.
Unique tokenomics advantages of LianGuaicman:
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Providing VeToken as an innovative way to offer fair rewards for early supporters during VeIDO.
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The oLianGuaiC token eliminates the forced relationship between token holders.
Tokenomics
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veIDO: Tokens reserved for VeIDO. A portion of the tokens will be immediately in circulation after IDO, while the remaining portion will be locked in VeLianGuaiC.
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Team: When the protocol is launched, all the team’s shares will be locked in veLianGuaiC for 2 years.
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Treasury: The treasury will hold LP tokens for LianGuaiC/USDC and LianGuaiC/ETH. Its funds come from VeIDO, protocol transaction fees, and discounted fees for option tokens.
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Liquidity Incentives: Reserved for liquidity mining.
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Airdrop/Marketing: 3% of the tokens will be airdropped to early users and early liquidity providers in multiple rounds. In addition, 4% of the tokens will be rewards for activities, marketing, collaborations, and other contributors.
veIDO
Unlike ordinary IDO methods, LianGuaicman Finance adopts a new locking model for token sales, which prevents dumping and promotes long-term investment. During the veLianGuaiC sale, users can choose the duration they want to lock their tokens. Additionally, LianGuaicman Finance sells $veLianGuaiC tokens instead of just $LianGuaiC tokens, allowing users to control their lock-up period.
veLianGuaiC
veLianGuaiC is a voting custody LianGuaiC used for voting on governance proposals and measuring weight. veLianGuaiC is an NFT based on the ERC-721 standard, but it is non-transferable. veLianGuaiC is obtained by locking LianGuaiC tokens. The longer the lock-up period, the more veLianGuaiC one will receive, and the veLianGuaiC balance will decay over time.
xLianGuaiC
xLianGuaiC is a tokenized version of veLianGuaiC locked for 2 years, and it is also a standard ERC-20 token. Users can freely convert between locked veLianGuaiC and xLianGuaiC at a 2:1 exchange rate within one year. Additionally, xLianGuaiC must be converted to veLianGuaiC to start earning protocol revenue.
oLianGuaiC
oLianGuaiC is a bullish option token for LianGuaiC, allowing holders to purchase LianGuaiC at a price lower than the market price. However, unlike regular tokens, oLianGuaiC does not expire.
Emission Schedule
The token emission will be divided into three stages, with different emission reduction amounts for each stage. 30 million LianGuaiC will be distributed over more than 120 periods, with distribution based on an exponential decay rate of 10% to 1%.
Roadmap
In Progress
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Review and provide users with a safer underlying liquidity exchange solution.
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Optimize leverage yield mining strategies and provide automatic or semi-automatic income strategies.
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Introduce a reward voting system in each emission period to foster a more actively involved community.
Q2 2023
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Complete development of the core product.
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Officially promote the project and expand the native Arbitrum DEX project network.
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Promote and complete VeIDO.
Q3 2023
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Launch automated leverage strategy products and integrate more Arbitrum projects.
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Launch semi-automatic fund strategies.
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Launch UniSwap V3 leverage strategy products.
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Integrate more Arbitrum projects and participate in project governance.
Q4 2023
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Launch the Arbitrum Ethereum liquidity aggregator.
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Optimize the leverage lending model and increase the utilization of funds for borrowers.
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Provide interest-free loans with ETH as collateral based on financial revenue and launch the PUSD stablecoin.
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Provide ETH LSD equity re-pledge service.
Q1 2024
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Implement AI-based investment and multi-chain implementation.
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Complete multi-chain expansion.
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Establish subsidiaries and launch the Project Ambassador Program.
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Launch AI strategy products.
Summary
LianGuaicman is the first decentralized leverage yield and liquidity aggregation protocol based on Arbitrum and zkSync. By pairing with ETH, LianGuaicman utilizes the liquidity of ETH to pool funds and significantly improve the capital efficiency of liquidity providers while mitigating liquidation risks. Additionally, LianGuaicman has developed an economic system based on veLianGuaiC and oLianGuaiC using Curve and FOO protocols, which reduces the negative impacts of mining and dumping behavior. Users can obtain interest-free loans by using ETH as collateral through LianGuaicman, thereby increasing the utilization of ETH funds in borrowing.
