Liquidity Pools
In games where you play against YOLO Games (versus PvP experiences), you effectively play against a Liquidity Pool (ETH or YOLO). This pool ensures that winners can be paid out without severely impacting the LP’s available funds.
The Liquidity Pools are designed to maximize expected growth rate while minimizing drawdown. They prioritize consistent returns and low volatility so depositors can comfortably enjoy watching their position compound over time.
Interested in the specifics of this mechanism? Check out the technical breakdown.
The funds in the pool are supplied both by YOLO Games and platform users. Naturally, it pays to supply liquidity.
💧 Earn Droplets
Add YOLO to the LP to earn Droplets. Not to be confused with Points (earned by gaming and completing challenges), these units will also earn YOLO at the end of the respective Season.
➕Get More ETH & YOLO
Liquidity Pools have an edge over the player of 1-2% — which means that, over time, depositors can expect a steady increase in their YOLO position.
📈 Do ETH Liquidity Providers Earn Native Yield?
It depends on the performance of the ETH Liquidity Pool.
If the ETH LP outperforms the native Blast yield for ETH during a monthly period by 20% or more, then the native yield generated in the respective monthly period will go to the YOLO Games treasury as a performance fee.
If the ETH LP does not outperform the native yield by 20% or more during a monthly period, then the native yield generated in the respective monthly period will be distributed to ETH liquidity providers according to their position sizes, time staked, etc.
See below for the methodology in calculating pool performance.
### Pool performance
The pool’s performance over a period of time can be calculated as follows:
- Find a user who has not deposited or withdrawn within that period of time
- Get the first block at the start of the given period and the final block at the end of the given period
- Call the
maxWithdrawfunction in the ETHLiquidityPool contract passing the respective block numbers for the user who has neither deposited or withdrawn in the period. The function should return the maximum withdrawable amount for that user - We can calculate the return by taking the maximum withdrawable amount at the end divided by the maximum withdrawable amount at the start. Multiply this by 100 to get it as a percentage
The aforementioned methodology highlights how to calculate the return of the pool between two times. The times that we will choose to measure between depend on the Lido Accounting Oracle.
This contract receives daily transactions in which the method is labeled “Submit Report Data”. We will use the first transaction of each month that uses this method to define the block times between which performance will be measured. So if we wanted to measure the month of June, we would take the block time from the June 1st transaction as the starting point and the July 1st transaction as the ending point.
Blast Native Yield
Blast’s Native Yield performance over a period of time can be calculated as follows:
- Blast relies on Lido for its native yield
- The Lido Accounting Oracle receives daily transactions in which the method is labeled “Submit Report Data”. Inside the transaction hashes, there is the “TokenRebased” event emitted.
- We can use the data emitted from this event to calculate the Native Yield earned over a given time period
- Lido emits this event at around 12:20 AM UTC every day plus or minus ~10 minutes
- Start by heading to the first emission of this event from which you want to begin tracking the yield. Record the “PostTotalEther” and “PostTotalShares”
- Calculate the initial share rate by dividing the “PostTotalEther” by the “PostTotalShares”
- Head to the final emission of this event within the period you want to track. Again record the “PostTotalEther” and “PostTotalShares”
- Calculate the final share rate by dividing the “PostTotalEther” by the “PostTotalShares”
- Divide the final share rate by the initial share rate to get the return over the time period. Multiply this by 100 to get it as a percentage
The time of the “TokenRebased'' event emission differs from the first block of that given day. When calculating the pool’s performance we will use identical block times to the “TokenRebased'' event emission, this ensures there is minimal error. We cannot use identical block numbers as the two contracts are on different blockchains. Hence, the “TokenRebased' event emissions will determine the start and end of a monthly period.
Historical Performance
The performance and final result of each month will be calculated and updated below before the 10th of each respective month.
| Month | Pool Performance | Native Yield | Target (1.2x Native Yield) | Result |
|---|---|---|---|---|
| June 2024 | 1.1924 (+19.2%) | 1.0026 (+0.26%) | 1.0031 (+0.31%) | OUTPERFORMED |
| July 2024 | 1.0852 (+8.52%) | 1.0026 (+0.26%) | 1.0031 (+0.31%) | OUTPERFORMED |
| August 2024 | 1.0566 (+5.66%) | 1.0027 (+0.27%) | 1.0032 (+0.32%) | OUTPERFORMED |
| September 2024 | 1.0219 (+2.19%) | 1.0025 (+0.25%) | 1.0030 (+0.30%) | OUTPERFORMED |
| October 2024 | 0.9955 (-0.45%) | 1.0026 (+0.26%) | 1.0031 (+0.31%) | UNDERPERFORMED |