Wombat Exchange ($WOM) is a BNB chain based stableswap protocol with open-liquidity pool, aiming to provide low slippage and single-sided staking. Backed by Binance Labs.
Wombat Exchange is a multi-chain stableswap built natively on the BNB Chain. Wombat adopts the concepts of asset-liability management and coverage ratio, enabling various stablecoins to be swapped at minimal slippage and the ability to single-stake stablecoins for sustainable yield.
Wombat's design aims to:
1. Make the algorithm more gas efficient;
2. Allow single-sided liquidity provision;
3. Get rid of the same-liquidity constraint for assets in the same pool.
Open-liquidity pools to achieve higher capital utilization
Allows single token liquidity provisions instead of pools-based
Innovative coverage-ratio-based stableswap mechanism to remove scalability barriers
Single-token LP token:
Simple to calculate the underlying
Each stablecoins has their own equilibrium
Great for yield farming, borrowing and lending platforms and trading platforms
Swap: As a profit for the protocol, we charge a certain percentage for each swap as a haircut fee, denoted as h (tentatively, we set h = 0.01%). The fee is charged in the to-token.
Currently, all fees retain in the pool as a reserve. A section of this fee might be shared with liquidity providers in the future.
Wombat’s asset-liability management design could potentially lead to withdrawal arbitrage, which drains funds from the pool. We developed withdrawal fee to prevent withdrawal arbitrage. Read more on the below page.
WOM is Wombat’s governance token and has the following use cases:
- Governance: WOM token holders can participate and vote on governance decisions.
- Liquidity Incentives: Users can earn WOM tokens as rewards by providing liquidity with stablecoins to the liquidity pool.
- Boosting: Users can earn additional WOM from the Boosting Pool by locking WOM tokens. The Boosting Pool incorporates voting escrow WOM (veWOM) for rewards accrual. Locking any amount of WOM applies a boost to all stablecoin pools.
