Sushi Protocol v3 Proposal: MIRIN
If you thought our 2021 resolution was simply being at the top of the DEX charts, think bigger. Welcome to the MIRIN proposal.
2021 has been a wild ride thus far and SushiSwap was catapulted into the new year with a $SUSHI price surge, the return of APY specials with Onsen and, probably, the biggest news of the year, when Binance set up its “own” SushiBar, adding SUSHI to its staking option list. This final SUSHI surprise opened the door to many new, previously unimaginable, opportunities for our SushiSwap community members, like you. If you thought our 2021 resolution was simply being at the top of the DEX charts, think bigger. Welcome to the MIRIN proposal.
MIRIN Introduction
MIRIN, a light alcohol particularly used to create sauces in Japanese cuisine, is the name of our proposed upgraded version of the SushiSwap protocol, or Sushi Protocol v3. Any sauce accentuates a main dish, so, think of MIRIN as a delectable compliment to the current version of SushiSwap that will make it deliciously tempting to a wider audience. MIRIN will be the first instance where a liquid-based product will be added to the brand, which is fitting as it hints at this proposal’s main objective: Adding liquidity. As mentioned in the previous paragraph, MIRIN’s vision is a shift away from focusing on only achieving milestones within the DeFi space. By dreaming bigger, this proposal will show you the missing ingredient required to see our protocol’s liquidity jump 10x or 20x. This missing ingredient will bring SushiSwap to the forefront of, not just the DEX ranking, but the overall cryptocurrency exchange ranking. The following will show you how these dreams can all come true, with a splash of MIRIN.
Franchised Pools or Exchange-Backed Pools
We invite you to view the Binance SUSHI staking announcement as a hypothetical ‘Phase One’ of a potentially lucrative relationship between SushiSwap and the abundance of traditional exchanges. This section will focus on the natural progression of DeFi integration and capitalization by exchanges, such as Binance, through our proposed Franchised Pools — LP Expansion Program.
Through this program, we pose to offer traditional exchanges a mutually valuable LP onboarding process. Similar to SushiSwap, Binance, for example, can offer their users the option of becoming liquidity providers through our protocol. Once a liquidity pair is added to a third-party platform it is known as a SubPool. The SubPool will trickle into the MainPool, which means that it will be added to SushiSwap’s overall liquidity pool.
This scenario is a win-win for both parties. How? The exchange offering the SubPool to its users can increase their platform activity, provide more yield-bearing options to users and earn revenue through transaction fees. SushiSwap can benefit by increasing total liquidity, securing a more prominent position in the market and can take advantage of brand exposure through reputable partners.
The pool is technically separate, however, and we will give the reigns to the third party exchange to manage its pool in terms of user participation parameters. They can also have the option of offering liquidity providers an additional native governance token, which we will discuss more in further detail in the next heading, and can set transaction fee amounts. The fee structure we would like to bring to your attention is as follows: (0.05% — 10%; 0.05% goes to xSUSHI holders). Although capped at 10%, the exchange are able to hedge their risk by charging participants a fee within the aforementioned range.
As a precaution, due to past history of centralized exchange security breaches, we want you to know that, although every SubPool of the same pair combined can be considered an accumulation for said pair’s entire liquidity on SushiSwap, there is still enough separation to ease any worries of added risk. For instance, users who add liquidity to a SubPool can only remove their liquidity from that SubPool. These stops were implemented to maintain certainty in the security of SushiSwap’s MainPool funds. With minimal risk exposure and maximum user benefit for both sides it truly can be seen as the next step in DeFi progression.
Will a traditional CEX go for it? Exchanges are constantly trying to retain their relevancy and overtake their competitors through unique tokens and/or investment vehicles. Traditional exchanges cannot offer the same appealing returns as DeFi protocols can, but they want their share of the pie, only with hedged risk. MIRIN offers these hungry exchanges an ideal solution to this problem and SUSHI has already proven to be a stable yield-bearing resource through SushiBar on an immensely reliable source.
Keep in mind exchange users’ assets are sleeping in their wallets and do not accrue interest. Sooner or later don’t you think these users will catch on to platforms that provide interest to hodlers? Can you even imagine how much potential liquidity is sitting, stagnant, across the many crypto exchanges around the world? Traditional exchanges are worried about this, but they can curb their user drain risk by partnering with a platform, like SushiSwap, by offering high, stable returns to their users’ assets, while remaining in custody of the assets. It is an optimal solution to the exchange giants’ biggest nightmare, volume loss. When we provide the solution to this problem, it will mean an unprecedented upsurge in SushiSwap overall liquidity and will see the protocol overtake all its competitors.
With your support of this proposal, we are confident that MIRIN’s Franchised Pools — LP Expansion Program will help bring SushiSwap the liquidity necessary to, at the very least, dominate global DEX rankings.
Double Yield, Diversified Governance Tokens
Now this is the most exciting potential feature of MIRIN’s Franchised Pools — LP Expansion Program, Double Yield. Many of you are currently earning SUSHI from being an LP and maybe even from being a farmer. All SubPool LPs will, naturally, also benefit from SUSHI rewards for their additions to the SubPool. Although we leave this in the hands of the participating exchanges, there is an option available to earn double yield from the exchange. How?
As our Franchised Pool partners earn transaction fees from liquidity pool and farming partakers, to further incentivize active use of this provision on their platform, we will include a SubPool third-party governance token minting configuration option. This means that the exchange, in addition to SUSHI, can offer users their own governance token, either existing or newly minted, to boost APYs. With yield values as enticing as they already are now, can you imagine the growth if those figures were to double? Imagine further a double yield on a SubPool of SUSHI + BNB, for example. It would blow the competition out of the water.
MIRIN gives exchanges the tools to seamlessly integrate SushiSwap liquidity providing and farming options, so their userbase can realize yields they never dreamed imaginable. With such an exciting offer, from an established source, as more users increase the SubPool, exchanges have a new way to increase their profits from transaction fees. As the SubPools increase the size of the our MainPool, we, at SushiSwap v3, can have a new, vast and reliable source of liquidity.
K3PR-Powered Yield Rebalancing
If you weren’t already convinced, this MIRIN feature should surely take the cake. We propose to incorporate, on v3 of Sushi Protocol, an automatic yield rebalancing tool, powered by K3PR technology. This can benefit you, since you can add a dedicated job to seek out the best LP yields for you. Keepers does the dirty work of all the calculations and comparisons needed to find the highest returns and automatically switches into those optimal pairs. To make this feature even more valuable, there is one more thing we must explain.
We understand that due to rising gas fees, this feature could bring about transaction cost concerns for many. Good news: We thought about that too! The amazing part is that this function takes into consideration any gas fees that will incur from LP pair swaps and will always only choose the pair that will give enough more of a yield to cover those payments. You can always turn off the automation whenever you please, but for those with little time to dig and uncover optimal yield balances, why not have the rebalancing done for you? With all that time saved and all that extra yield you’re getting, it’s the perfect opportunity to kick back and have a sip of MIRIN.
Integrated 1-Click Zap Features
As gwei for the gas continues to skyrocket, even spiking at over 500 the other day, we are all trying to avoid those pesky gas fees as much as we can. With the overwhelmingly positive response from our community for SushiSwap Lite’s liquidity providing Zap tool, which saves you gas fees by reducing the number of transactions necessary to become an LP, we are proposing to integrate the tool across the platform. MIRIN can offer the following functions as a 1-click Zap option:
- 1-Click: Swap + Add Liquidity + Farming
- 1-Click: Migrate from Uniswap/Balancer/Curve + Farming
- 1-Click: Switch Pools to secure higher APYs
Your support of this proposal will result in the addition of these options to MIRIN, Sushi Protocol v3!
New LP Curve Options
Finally, we propose, for new liquidity pair creators some added curve & fee structures that they can implement when providing a new LP to the ecosystem. The constant product curve that currently dominates SushiSwap will still be available, however, the two new proposed options will be:
- Rebalancing Curve (balancer.finance model)
- Bonding Curve (curve.fi model; for stablecoins)
Your support of this proposal will bring forth the growth of choice in pair structuring at onset.
Conclusion
With the recent onboarding of SUSHI staking on Binance, we see the great potential there is in both penetrating the world of centralized exchanges and adding more valuable platform options to our community members. We want to become top of mind, not just for DeFi enthusiasts, but for cryptocurrency traders of any sophistication. By exposing users of traditional exchanges to the great benefits of the Sushi protocol with MIRIN, SushiSwap v3, we are certain that we can swiftly and exceedingly grow our userbase to such significant levels, where we will not only be considered a DEX contender, but a force to be reckoned with to traditional heavy hitters.
We appreciate the precious time you have taken out of your day to overlook the MIRIN proposal and thank you in advance for supporting our vision.
