Brokkr Roadmap 2024
Last year, we laid a strong foundation, and this year, we’re building on it. We’ve developed smart liquidity management strategies and began exploring UniswapV4. Now, we bring the most advanced strategies to form high-performing yield vaults and make them ready for UniV4.
Q1 Kick-off
1. Trading LP Vaults
The strategy behind Trading LP Vaults combines trading with providing liquidity. It uses price signals to adjust how and when liquidity is provided to optimize exposure to the asset price while gathering LP fees.
By using concentrated liquidity pools, the liquidity can be provided asymmetrically to adjust the exposure to ETH or any other asset. When the price increases, liquidity is provided in ETH to benefit from the price movement. When the price decreases, the liquidity is rebalanced to USDC to limit the exposure to ETH price.
By adjusting the ratios between the tokens, we benefit when the price increases and are stable when the price decreases.
The backtesting data show outstanding results:
• $ETH = +14% vs. ETH, +21% vs. HODL, ~24 months backtest
• $ARB = +30% vs. ARB, +37% vs. HODL, ~12 months backtest
• $wBTC-ETH = +20% vs. HODL, ~18 months backtest
• $GMX-ETH = +30% vs. HODL, ~18 months backtest
The vault will be completely automated and work on autopilot.
2. BRO Incentives
To bootstrap the TVL in Brokkr vaults, we will roll out $BRO incentives. Initially, they will be used to incentivize ETH-based vault and strategies, and the BRO-ETH liquidity pool. The incentives will scale with the deposited amount and the length of the deposit. The longer you stay in the vaults, the more BRO you get.
A month in, bBRO holders will direct where the incentives go. And we will integrate Merkl to enable farming external liquidity incentives.
Q2 Expansion
3. V3 Delta Neutral Strategy Vault
Delta Neutral Strategy lets you earn trading fees without worrying about price swings. By longing and shorting an asset at the same time, it removes the price volatility while farming yield.
The strategy takes part of the non-volatile funds (USDC) as a collateral to borrow the volatile asset (ETH) and then it provides both assets in the LP strategy. As the ratio between assets in the concentrated liquidity pools quickly changes with the price, the strategy must have a robust rebalancing and debt repaying mechanism to prevent liquidations on the lending platform. The added complexity of managing the pool is the reason why V3 DNS is not widely spread and makes it hard to replicate.
Our DNS on Terra and Avalanche that used V2 pools yielded between 12–15% APY. By using concentrated liquidity (V3) pools, we expect even higher performance thanks to our LP strategies.
4. $BRO RealYield
We will activate RealYield for the bBRO holders who are staked. Part of the generated fees from our vaults and strategies will be swapped for BRO on the market and then shared with the bBRO holders.
5. EVM-Chain Expansion
We plan to expand to other chains to reach more users and form partnerships. We’re already getting a lot of interest from V3 DEXs that would like to integrate the V3 Delta Neutral Strategy as they see the need for a stable yield strategy.
Q3 High Stakes
6. UniswapV4 LP Management
When Uniswap releases V4, we’ll be one of the first to dive in with liquidity management and yield farming. It will attract a large part of the V2 ($2.7bn) and V3 ($2.7bn) liquidity that will need to be managed. And that’s what we do well.
UniswapV4 is based on the concentrated liquidity (V3) pools, but it brings additional features with hooks and makes it cheaper to operate, which will make the current V3 version obsolete. And because V4 can also mimic V2 pools, there will be no reason to open regular V2 pools anymore.
UniswapV4 enables liquidity incentives through hooks (eg. our Liquidity incentive hook) and incentives will play a key role in attracting liquidity to V4 pools. We will build automated yield vaults that will farm the crazy initial rewards with maximum performance.
Hooks will increase the profitability of providing liquidity, letting us build high APR vaults with limited impermanent loss.
7. Liquidity Hooks
Hooks are the major feature of UniV4 and are THE thing that makes V4 unique. We will provide the most sought-after hooks to pool deployers for a fee.
We’ve already developed multiple LP-enhancing hooks for the Uniswap Foundation grant we received last year. This gives us an advantage when UniV4 launches. The hooks we built are Liquidity locking, Dynamic fees, Liquidity management, and a combination hook of Liquidity locking and Dynamic fees.
Planned hooks
1. V2 Pool Lookalike
V2 pools are super simple, users just deposit liquidity and can forget about it, which is not possible in V3 pools. That’s also why around 90% of newly created pools on Uniswap are V2 and not V3.
We will build a hook that makes a V4 pool look like a V2 pool, so the liquidity providers don’t have to manage anything. In combination with that, we will have a simple migration tool that will transfer liquidity from a V2 pool to a V4 (V2) pool in a few clicks.
2. Liquidity incentives
Liquidity incentives are one of the best instruments to attract liquidity to a pool. With our hook, we enable liquidity incentives with a custom schedule, token, NFTs, and anything that’s needed.
3. Dynamic fees
Dynamic fees are the main instrument how liquidity providers can be more profitable. Currently, they lose a lot of money to arbitrageurs and position rebalances. Dynamic fees take part of the arbitrageurs profits in times of high volatility and give it back to LPs which increases the performance of liquidity vaults.
Q4 Momentum
8. UniswapV4 DNS
Once UniswapV4 is released, we will start integrating Delta Neutral Strategy. Thanks to the hooks that increase LP performance, it should have the highest performance out of all Uniswap’s versions. If UniswapV4 draws in a lot of interest and liquidity, it’ll make the DNS even more valuable.
Continuous Improvement
Besides the big updates, we are continuously enhancing the performance of the vaults and strategies
• Optimizing the strategy set up to increase the generated yield
• Enabling LP leverage to increase the performance (apx. Up to 30% to certain strategies)
• Offering directional liquidity providing that minimizes impermanent loss while being exposed to the asset price
• Integrating THORChain & Maya for swapping and Savers vaults when possible
