EQUIP-6: Equation v2 Upgrade and Mining Migration Plan

Abstract

The development progress of Equation v2 has reached the final stage of contract auditing and is expected to be deployed on Arbitrum by the end of January or early February. This proposal primarily focuses on the upgrade to v2, the tokens planned to be supported at launch, and the mining migration plan from v1 to v2.

Specification

Equation v2 is a significant upgrade to the BRMM algorithm, with major improvements:

1. Precise passive position for LPs.
2. Multiple fee and leverage tiers.
3. The Risk Buffer Fund (RBF) is removed.

The upgrade gives LPs the ability to hedge risks accurately and enables them to expand a variety of market-making strategies. With this upgrade, Equation theoretically can support any asset with an oracle price.

Upon the launch of v2, we plan to support perpetual contract trading for the following 48 tokens, which include:

ETH (100x), BTC (100x), SOL (50x), ARB (50x), OP (50x), MATIC (50x), AVAX (50x), LINK (50x), XRP (50x), DOGE (50x), ADA (50x), BNB (50x), LTC (50x), ETC (50x), DOT (50x), ATOM (50x), NEAR (50x), UNI (50x), AAVE (50x), GMX (50x), DYDX (50x), SNX (50x), MKR (50x), 1INCH (50x), SUI (50x), TIA (50x), INJ (50x), LDO (50x), STX (50x), RUNE (50x), FTM (50x), APT (50x), 1000PEPE (50x), CRV (20x), SUSHI (20x), PENDLE (20x), ORDI (20x), RDNT (20x), FIL (20x), SEI (20x), BLUR (20x), MINA (20x), NTRN (20x), PYTH (20x), ENS (20x), JTO (20x), TRB (20x), 1000BONK (20x)

The tokens will continue to expand in the future according to market conditions.

The levels of trading fee and leverage will be set as:

Considering market promotion and the competitive landscape, a 50% discount on trading fees will be offered to all traders who bind a referral code during the initial phase of v2. This discount is subject to later adjustments based on market conditions.

Mining Migration Plan

After the launch of Equation v2, it will coexist with v1 for a period until all users switch from v1 to v2. The mining migration plan aims to allow all users to smoothly migrate from v1 to v2 by gradually adjusting the rewards allocation.

Current Mining Allocation in v1:

[Traders] Position Holders: 40% [Pools] Liquidity Providers: 10.8% [RBF] Liquidity Providers: 16% [Pool2] EQU/ETH Liquidity Providers: 20% [EFC Member NFT] Holders: 12% [EFC Connector NFT] Holders: 1.2%

Mining Migration Plan from v1 to v2

Step 1: Half of the v1 liquidity mining, which is 5.4%, half of the RBF liquidity mining, which is 8%, and the portions from referral mining, which are 2% for EFC Members and 0.2% for EFC Connectors, totaling 15.6%, will be transferred to v2 liquidity mining.

Step 2: The entire v1 position mining quota, which is 40%, will be transferred to v2 position mining. The portions from referral mining, which are 10% for EFC Members and 1% for EFC Connectors, will be transferred to EFC Members and EFC Connectors, respectively, in v2 referral mining.

Step 3: The remaining 5.4% of the v1 liquidity mining quota will be transferred to v2 liquidity mining.

Step 4: Based on the LPs' withdrawal activity from the v1 RBF, the remaining RBF liquidity mining quota will be gradually transferred to v2 liquidity mining until the transfer is fully completed.

Finally, the EQU Mining Allocation in v2 will be:

Voting for EQUIP-6:

The vote on this proposal will begin at 10:00 UTC on January 19, 2024, and will last for three days. Upon approval of this proposal, the development team will announce the specific launch date based on the status of deployment preparations.