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Core Vault Functionality

How does the Elastic Protocol's core vault operate in relation to AMPL's rebase status?

Our core strategy creates opportunities for users to earn yield during all market conditions (uptrends and downtrends), and participate in the Olympus ecosystem of products and services, which provide yield (in the form of stablecoins and OHM).

The core vault of the Elastic Protocol is shaped by the Ampleforth (AMPL) token's rebase mechanic. AMPL can exist in three states:

  • Expansion: AMPL's supply increases (positive rebase)
  • Contraction: AMPL's supply decreases (negative rebase)
  • Steady State: AMPL's supply does not change (neutral rebase)

The core Elastic Protocol vault responds to AMPL's rebase status, as outlined in the table below.

Vault FunctionalityDescription
EEFI Minting CriteriaThe Elastic vault uses two pieces of information to determine how much EEFI is minted:

- Amount of AMPL deposited into Elastic Vault

- AMPL's rebase status
EEFI Minting CalculationDuring negative rebases, the vault mints EEFI according to this calculation: AMPL in Vault x .00001

During neutral rebases, the vault mints EEFI according to this calculation: AMPL in Vault x .0001

For example, if 700,000 AMPL were deposited into the Elastic Vault the following amounts of EEFI would be minted (during each day of negative/neutral rebase):

- Negative Rebase: 7 EEFI: (700,000 x .00001)

- Neutral Rebase: 70 EEFI: (700,000 x .0001).

EEFI is not minted during positive rebases, instead EEFI is purchased and burned.

When a user deposits AMPL into the Elastic Vault (vault deposits are locked for 90 days) they receive EEFI according to this calculation: (AMPL deposited x .0001) - .65%.

The .65% fee is distributed to the Elastic Finance DAO Treasury.
Vault Operations During Positive RebasesDuring positive rebases, EEFI is purchased and burned using a percentage of new AMPL supply within the Elastic Vault. Specifically:

- 45% of new AMPL supply is sold for EEFI. (10% of purchased EEFI is deposited in to the Elastic Protocol DAO Treasury, the rest is burned).

- 23% of new AMPL supply is sold for OHM. This OHM is distributed to Elastic Protocol stakers and the Elastic Finance DAO Treasury as outlined in the next section.

-2% of AMPL generated during positive rebases is deposited into the Elastic Finance DAO Treasury.

-30% of AMPL generated during positive rebases remains in the Elastic Vault (and can be later withdrawn by non-DAO AMPL depositors).
Token DistributionThe Elastic Protocol emits EEFI rewards during neutral and negative rebases, and OHM during positive rebases. Tokens are distributed to stakers as follows:

- AMPL Stakers: 55% of minted EEFI/purchased OHM - Stake AMPL

- EEFI/OHM Liquidity Token Stakers: 35% of minted EEFI/purchased OHM Learn how to provide EEFI/OHM liquidity -- Stake EEFI/OHM LP tokens

- Elastic Finance DAO Treasury: 10% of minted EEFI/purchased OHM

EEFI Reward For Calling the Elastic Vault 'Rebase' Function

Each day, the Elastic Vault's 'Rebase' function must be called to facilitate its operations. This function:

  • Checks the AMPL supply to determine whether it has increased, decreased or remained stable
  • Mints and distributes EEFI rewards to AMPL and OHM/EEFI stakers
  • Prepares AMPL emitted during positive rebases to be sold for EEFI and OHM

Anyone can can call the rebase function, once every 24 hours. Successful rebase callers will receive a maximum of 2 EEFI reward per day as partial compensation for providing this important service.

Simulate Potential EEFI Emissions

We have developed an EEFI Rewards Simulation Tool, which you can use to determine how many EEFI tokens may be emitted by the vault based on the amount of AMPL staked, AMPL's rebase status and other factors.

EEFI Simulator

Access the EEFI Rewards Simulation Tool

How will the Elastic Protocol Generate "Real Yield" via the Olympus Ecosystem?

Via our partnership with Olympus DAO, the Elastic Protocol's future sub-vaults will provide stakers with the opportunity to participate in the Olympus ecosystem of products and services and earn yield in the form of OHM and stablecoins.

Olympus Ecosystem FeatureElastic Protocol Integration
OHM Cooler LoansPotential for the protocol to participate in Cooler Loans to bolster stablecoin yield for borrowers
OHM BondsOHM Bonds are a new Olympus offering that enable OHM holders to purchase bonds using OHM. These bonds mature at various time periods, and provide OHM rewards at maturity. In the near future the Elastic Finance DAO will launch a feature where vault stakers will be able to use their OHM rewards to automatically purchase bonds.