Introduce APR boosts for ABRA/USDT liquidity providers.

Proposal: Boosted Rewards for Liquidity Providers

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TL;DR

Provide ABRA/USDT liquidity → Earn higher APRs on your strategy deposits.

We propose introducing a dynamic reward boost for users who support protocol liquidity. The more of the ABRA/USDT pool you own, the more of your strategy deposits qualify for boosted APRs — funded by unused ABRA from the Referral Rewards Pool and Holder Bonus Pool.

Every time you add liquidity to the ABRA/USDT pool, the protocol records the percentage of the pool that you own at that moment. That percentage automatically determines how much of your deposit in strategies enjoys a higher APR, and it grows or shrinks in step with the pool itself.

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Background & Motivation

The primary goal is to deepen ABRA/USDT liquidity and create incentives that align user behavior with the health of the protocol. In Cadabra, where token price plays a central role, it’s crucial to encourage actions that support the system rather than undermine it. For example, when ABRA/USDT price dips, we want to incentivize users to add liquidity rather than exit.

Protocols like Curve and Pendle offer APR boosts in exchange for locking native tokens, but these mechanisms do not directly support liquidity. In contrast, our proposed approach offers a similar boosting mechanism, but for those who provide liquidity in the ABRA/USDT pool. This not only strengthens the protocol’s stability but also benefits existing token lockers through improved price support.

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How the New Boost Works

1. Provide Liquidity — Earn a “Fixed Share” 2. When you add ABRA/USDT liquidity, the protocol snapshots the pool size after your deposit and records the percentage share that belongs to you.
   - Example: the pool holds 100k you add another 100k → you now own 50 % of the pool. 3. That percentage is your personal Fixed Share. 4. Your Fixed Share remains constant (relative to the pool size at the time of deposit) until you withdraw

2. Working Balance in Strategies 3. Your Fixed Share translates into a working balance: the amount of your strategies deposits eligible for the higher APR. working_balance=poolTVL×your_fixed_share 4. As the pool grows, your working balance grows automatically; if the pool shrinks, it shrinks in the same proportion. 5. If you later add more liquidity, the new deposit gets its own Fixed Share, and it simply added to the old one.

3. Withdrawing Liquidity 4. Removing liquidity scales down the your Fixed Share by the same fraction you withdraw. I.e. if you withdraw 20% of your LP tokens, your share is now 80% of the original.

4. Receiving the Boost 5. Every strategy deposit earns its base APR. 6. The portion of your deposits covered by your Working Balance receives an additional boost, up to a maximum cap. 7. If your working balance fully covers your deposits, you receive the full boost; if it covers less, the boost scales down linearly.

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Example Walk‑Through

• Day 1 – Pool TVL = 100k; you add another 100k.

  • Fixed Share: 50 %.
  • Working balance immediately equals 50 % of pool TVL → $100 000.

• Day 10 – Pool TVL doubles to $400 000 (other users add funds).

  • Your Fixed Share is still 50 %.
  • Working balance auto‑adjusts to 50 % of $400 000 → $200 000. Your eligible boosted amount has doubled.

• Day 20 – You withdraw half your liquidity.

  • Your Fixed Share drops from 50 % to 25 %.
  • Working balance instantly halves.

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Funding & Emissions

Boost rewards will be sourced from unused ABRA tokens originally allocated to the Referral Rewards Pool and Holder Bonus Pool. Instead of being burned, these tokens will be redirected to fund boosts.

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Benefits

This mechanism introduces a compelling, game-theoretic layer where users are encouraged to support the system during downturns and rewarded when it recovers. This mechanism allows participants to secure a larger working balance at favorable moments, which grows in value as the pool recovers. It also introduces a competitive dynamic, where users rival for a larger share of the pool.

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The formal description of the boost algorithm is available at the following link: https://cadabra.gitbook.io/v2/articles/strategies-boost-algorithm