Alpaca Finance

Background:

Our Fantom’s farm has seen a steady growth with TVL over $37 Mn one week after launch. Our FTM and USDC lending pools also have the highest APY compared to other protocols on Fantom! With these strong metrics and our plan to launch more products on Fantom (as outlined here https://medium.com/alpaca-finance/alpaca-finance-is-going-multi-chain-announcing-the-herds-expansion-to-fantom-network-e5f588650ab1), we are confident Alpaca will grow to be one of the leading protocols on the chain.

As the platform grows, so does the protocol revenue. As a result, one of the questions many community members have been asking us is “What will happen to the protocol revenue generated on Fantom?”

Below, we’ll give some answers to that which will lead into a Proposal:

• Lending performance fee goes towards buyback&burn: This is straightforward and how we already do it on BNB Chain. Since the $ALPACA on BNB Chain and Fantom have a shared supply, the buybacks benefit all ALPACA holders regardless of where they hold it.

• Revenue from the farming performance fee: We believe what we do with this revenue channel warrants serious consideration because it can have a strong impact on Alpaca’s future growth prospects and token price. This will be the main topic of this proposal.

• Grazing Range Rewards: Similar to above, how we decide to handle partners’ tokens will directly influence the attractiveness and success of our Grazing Range partnership program on Fantom.

For more details, please refer to the forum discussion on this topic: https://forum.alpacafinance.org/t/aip-2-governance-vault-on-fantom/188

Implementation:

Four voting options are presented.

Option#1 (“Pro-rata distribution”)

• Create a Governance Vault on Fantom
• Emission to the Governance Vault + Revenue generated on each chain are combined and distributed based on xALPACA amount on each chain so that the APR% achieved in both governance vaults are equal (ALPACA portion only)
• A fixed portion of GR rewards on Fantom (20%) get distributed back to Governance Vault stakers on BNB Chain (no selling of rewards token; must claim on Fantom)

Option#2 (“Fixed % distribution”)

• Create a Governance Vault on Fantom
• A fixed portion of the revenue generated + GR rewards on Fantom get distributed back to Governance Vault stakers on BNB Chain while the rest are distributed to stakers on Fantom.

Option#3 (“100% Fantom distribution”)

• Create a Governance Vault on Fantom
• All revenue + GR rewards on Fantom get distributed to Governance Vault stakers on Fantom, similar to how we do it on BNB Chain

Option#4 (“No Governance Vault”)

• No Governance Vault on Fantom
• All revenue from Fantom gets bridged and then distributed to Governance Vault stakers on BNB Chain