Optimizing Yield on Lazy River with vePERP

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Are you curious about how to optimize your yield on Lazy River? Look no further! In this thread, we'll be sharing some insights to optimize the reward, including 📌 Lock amount 📌 Lock period 📌 Claim frequency So, buckle up and get ready to learn the insight of vePERP! 🥨

1/ Starting from December 2022, holders of vePERP (also known as locked PERP) have collectively earned more than $300,000 in fees through the weekly distribution of USDC sharing.💰💰💰 twitter.com/perpprotocol/status/1636475768015319042?s=20

2/ The question at hand is the origin of the yield. To put it simply, the yield is generated from the trading fee, and based on the current payout structure, 15% of the trading fee on PERP v.2 will be distributed on a weekly basis.

3/ The rising trading volume on @perpprotocol since December 2022, as indicated by the rolling 7-day average, is definitely a positive development. This growth has led to an upswing in the weekly fee.

4/ As the fee distribution rises, more people want to lock their $PERP to be eligible for sharing of this fee. Currently, 17.9M $PERP out of 66M are locked (as of March 16th). Increasing locked $PERP while trading fees constant leads to reward dilution.

5/ Prior to locking your PERP, it is essential to assess the future growth of trading fees generated by PERP v.2. If you are uncertain about future developments, you may want to consider partial locking or varying locking periods as part of your risk management.

6/ To maximize their share (% ownership) of the weekly reward, a vePERP holder may aim to lock the highest amount of PERP for the longest period of 52 weeks. perpprotocol.mirror.xyz/q9govjXM188McbXniVAFvHtsd4jTWF-C1djmJCLWIlY

7/ 📌Lock amount The more PERP that is locked, the higher the proportion of the weekly fee that one is entitled to receive. The accompanying chart presents the fee that a vePERP holder can expect to receive as a reward from last week (March 9th), assuming a 52-week lockup period

8/ 📌 Lock period The longer period that PERP is locked, the higher % ownership on the reward. The accompanying chart presents the fee that a vePERP holder can expect to receive as a reward from last week (March 9th), assuming a 10,000 PERP lockup

9/ The heat map below illustrates the expected $USDC with respect to the lock amount and period for vePERP during the last week. Note that this is a one-week reward without LOCKED PERP REWARDS. Keep in mind that this map may no longer be valid in a week's time when things change.

10/ 📌 Claim frequency There are many factors related to claim frequency, people claim their staking rewards for many reasons but for the re-investing aspect. The lowest amount of gas fee and the %APY for re-investing should be considered. Rule of thumb: Gas Fee < 3% of Rewards

11/ Suppose that the cost of claiming, swapping, and re-staking gas is $2.5. To apply the 3% rule of thumb, the minimum reward should be calculated as $2.5 ÷ 0.03, which equals $83.

12/12 We welcome you to join us and ask any questions about optimizing the Lazy River reward. Don't hesitate to reach out if you need help with anything related to this topic. Join us at Discord discord.com/invite/Dq9mTmCaBb Follow @perpprotocol Credits to @InvestgineerX