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GrowthDeFi is a decentralized ecosystem that focuses on capital efficiency and maximizing returns through a variety of products. The GrowthDefi ecosystem comprises efficient blockchain technologies to optimize token holder value and maintain the best yields and products in the market.
One of the outstanding features is the deflationary mechanism, meaning the value of the token can increase over the long term regardless of macroeconomic conditions. All the tokens on the ecosystem are underpinned by this deflationary aspect. For clarity, tokens are a type of cryptocurrency that can be an asset or hold a specific value. They can be used for trade or investment purposes.
GrowthDefi employs decentralized finance methods and blockchain technology to introduce a comprehensive yield farming offering.
GRO, WHEAT, and gROOT are the three tokens available in the GrowthDefi ecosystem. The GRO token is the core as it has governance rights over everything and it gets a percentage from the revenue of anything that is built. GRO can be staked for more GRO (stkGRO) or for BNB (GRO Yield).
The gROOT token is a diversified way to invest in more products such as strategy tokens, gROOT can be staked in gROOT harvest for BNB.
The WHEAT token incentivizes the products on the ecosystem. The deflationary feature here is embedded within the smart contracts that catapult the process of the WHEAT token becoming deflationary.
All three tokens share the deflationary aspect because the ultimate goal is driving up demand and reducing the supply, here are some of its deflationary mechanisms:
- WHEAT buyback contract (buybacks and burns WHEAT and GRO)
- stkGRO (burns GRO)
- GRO bridge (burns GRO)
- GRO yield (buybacks and burns GRO)
- gROOT harvest (buybacks and burns gROOT)
- gROOT treasury (buybacks and burns gROOT)
What GrowthDefi will achieve with the WHEAT token
The need-to-know words with WHEAT tokens are ‘buyback’ and ‘burn’. A fixed percentage of revenue is used to buyback WHEAT tokens on the open market and remove them from the overall supply.
This is integral to the WHEAT token optimization strategy because it leads to the foundation of GrowthDefi’s brand promise of deflation. Users must know that for the short term the emissions of WHEAT are used to incentivize users to deposit their LP tokens into the protocol. This is so the balance can grow exponentially at shorter timeframes, in the Fee Collector that is programmed to implement the automated buyback and burn strategy.
For the long term, token holders should note that emissions continually incentivize the different products offered whilst being deflationary. This deflation takes place when the buyback contract is buying back and burning more than the WHEAT emission rate at the time.
Sustainably of the WHEAT tokens
The model used to farm involves using existing revenue to buyback the tokens. However, the point at which the protocol is at optimal profits usually corresponds with the highest price point of the token. This makes the buyback amount small compared to the token being issued.
When the price of the token decreased to the point of Total Locked Value (TVL) staying in the protocol and generating a more consistent stream of revenue.
The revenue model
The main revenue source is deposits and performance fees. The deposits increase the balances of the fee collects at a rapid rate. In this case, users are less likely to withdraw their funds if the is a deposit fee.
The performance fees bank likelihood that the TLV staying within the protocol and generating a consistent revenue source.
In this case deposit fees are known to be big but inconsistent, however, performance fees are known to be more reliable.
Scenario planning for price fluctuations
In the event the price of the WHEAT token goes down, there will be fewer deposit and performance fees and the swap fee growth will remain the same.
If the price of the WHEAT token stays the same, there will be consistent deposits and performance fees. The swap fee growth will remain the same, furthermore the number of WHEAT tokens being bought back up increases over time.
If the price of the WHEAT token increases, there will be a substantial rise in deposits and performance fees although the swap fee growth will remain the same.
The goal of the WHEAT token is sustainable farming and growth over a long-term period. Incentivizing the products on the ecosystem is also a goal set by GrowthDefi.
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.
Fee collectors contract
For every token there is a fee collectors contract, it serves the purpose of collecting the fees, staking them in organized contracts to generate a return, and send the profits to the main WHEAT buyback contract.
Wheat token buyback contract
These are the steps that the contract follows with the incoming cake:
- Convert it to wrapped BNB token on Binance blockchain, WBNB
- Buyback WHEAT and burn it with 70% of the WBNB
- Buyback gro and burn it with 15% of the WBNB
- Inject 15% of the WBNB into gro yield
What is noteworthy is that the vaults portfolio of GrowthDefi which is held on the Binance Smart Chain (BSC) is audited by Consensys Diligence. When vaults are audited they qualify to be recognized as collateral. In the quest to add monetary value to the ecosystem, GrothDefi has added a collateralized stable coin called MOR.
About the MOR token
The MOR coin is set to work efficiently and benefit holders of WHEAT, GRO, and gROOT.
MOR is a stable coin that is soft pegged to the U.S. dollar through different stability mechanisms. Its purpose is always being close to the $1 mark and thus allowing users to leverage up in yield farming positions with low-interest rates.
MOR can be minted at a fixed exchange rate and providing collateral. MOR can be minted at a fixed exchange rate which involves stable coins that are regulated financial institutions, backed by fully reserved assets, redeemable on a 1:1 basis for U.S. dollars. The stable coins are also governed by Centre, a membership-based consortium that sets technical, policy, and financial standards for stable coins. The available minting stable coins are BUSD, USDC, USDT, DAI, and TUSD.
For providing collateral there are standard tokens (BNB, BTCB, ETH), and vault tokens (stkCAKE, stkBNB/BUSD CAKE LP).
Each collateral has its own parameters depending on the risk of the collateral, the parameters are; liquidation ratio, stability fees, liquidation buffer, and the debt ceiling.
Stability of MOR price
GrowthDefi employs several stability mechanisms to ensure MOR keeps its peg. Keeping stable coins in the protocol’s reserves ensures the price of MOR can only go as low as the redeemable exchange rate. All the fees generate a surplus system, to ensure there will always be coins in circulation regardless of users redeeming coins.
MOR is useful for users as it is built for capital efficiency. Users can use it to leverage up a long position on any of the supported collaterals, this is especially useful for yielding collaterals since you can essentially be paid to borrow.
MOR benefits for GrowthDefi ecosystem
MOR generates profits for buybacking WHEAT and GRO in four ways; mint/redeem fees, stability fees, liquidation buffer, and vault performance fees. Mint or redeem fees refer to the process where mint is MOR is minted with a stable coin or is redeemed for one a small fee is charged.
Liquidation buffers are when a user liquidates their MOR and it is burnt, more than the amount that was minted when the user opened up the position, this increases the system surplus.
Vault performance fees are stkCAKE as a collateral example some WHEAT vault tokens would be supported as collateral, this means that WHEAT and GRO would also benefit from the performance fees generated from these vaults.
GrowthDefi has an elaborate earnings system wherein users can earn in six different ways including; earning WHEAT and cake using wheat pancake swap strategy token, staking WHEAT, providing liquidity to one of the core pairs to earn wheat staking gro into gro yield to earn BNB, staking gro into (stk, gro) to earn gro and taking gROOT into gROOT Harvest to earn BNB
GrowthDefi offers a comprehensive, rewards-based ecosystem for the WHEAT token. Users are able to earn and understand their rewards structure transparently.
The yield farming industry is estimated to have generated cryptocurrency rewards to the amount of $18.5 billion in TLV. Permission-less and automated protocols are a growing industry, which is inflicting disruption on traditional banking and finance protocols.
Users or keen onlookers in the finance and investment area looking to grow their portfolio with long-term strategies may explore the GrowthDefi wheat token. Yield farming offers an opportunity to amass a passive income in a booming industry.
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