Yearn Finance has announced a partnership with Pickle Finance to help yield farming rewards and reward victims of the recent Pickle exploit, which resulted in the loss of almost $20 million in Dai.
The change is planned to decrease redundant jobs, increase specialization, and exploit mutual skills, according to an announcement from Yearn creator Andre Cronje. The cloned copies of Yearn’s v1 yVaults will become Pickle Finance vaults, or “Pickle Jars.”
In order to maintain assets tightly associated with the dollar on which they are based, Pickle Finance allows farmers to sell safe coins selling above their peg and purchase some below it.
Features of the Absorption
1/ We are pleased to announce that Yearn has formed a symbiotic relationship with @picklefinance.
— yearn.finance (@iearnfinance) November 24, 2020
List of changes
Jars merge with Yearn. Pickle Jars will be deployed as Yearn vaults, using the forthcoming v2 design. A more detailed migration plan to follow.
Strategies earn 10% performance fees. Pickle devs will continue to write strategies, earning a 10% performance fee under the new Yearn fee structure.
Reward Gauges are introduced. Pickle tokens are rewarded through staking Yearn vault tokens in Pickle gauges. The emissions schedule stays roughly the same. Rewards can be boosted by DILL (see below). Reward gauges may earn Pickle based on the underlying Yearn vault token.
DILL boosts Pickle rewards. Pickle tokens can now be vote locked. Locking Pickle yields DILL (Pickle tokens that are placed in time locked escrow). The longer time period the Pickle is locked for, the more DILLs are received. The minimum locking period is 1 week and the maximum period is 4 years. Holders of DILL can participate in Pickle governance and boost rewards received from Yearn Vault gauges. Pickle Governance decides on gauge weights, fee allocations, and other protocol parameters.
CORNICHON tracks Evil Jar losses. A new token, CORNICHON, is created to track losses stemming from the recent Evil Jar attack against Pickle’s Dai Jar. Tokens will be minted against a snapshot of balances at the time of the attack, and distributed to victims proportionally. Further measures may then be adopted by Pickle Governance through its regular decision process.
Pickle multi-sig rotates. To enable timely development and testing of the new system, the keys for Pickle’s executive multi-sig are rotated.
The overall aim is to raise returns under the new year fee system for yield farmers with Pickle techniques that receive improved farming fees. Yearn Finance, which newly formalized an operational budget, aims to devise innovative tactics and fee systems for the new vaults to onboard Pickle developers and strategy builders.
Reward gauges would be added by Pickle, with tokens allocated among all that are interested in Yearn vault tokens. Such tokens will now be time-locked in escrow and can be named DILL, and will also be used by Yearn Vault gauges to compete in Pickle governance and improve incentives.