An article to understand the governance revenue aggregator Magpie: use cases, advantages and gameplay

Everyone is familiar with voting governance, which originated from the veTokenomic model launched by Curve. In this model, users must lock their governance tokens as veTokens for a certain period of time to increase the APR they obtain and decide the agreement’s governance token by voting. The release will help the platform control governance token inflation and distribute more governance tokens to long-term holders. However, the veTokenomics model is not perfect, and there is still room for improvement, such as the following issues:

- The requirement to buy in and lock for a period of time prevents many users from participating;

- The income of veToken holders is not high, maybe even zero;

-Voting rights with high cost - users must purchase and lock tokens to obtain voting rights, but are not eligible for passive income.

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Introduction to Magpie

Magpie is a revenue aggregator and multi-chain DeFi application established in cooperation with the Wombat trading platform. The project utilizes Curve's veToken mechanism to reward long-term holders by reducing supply, while assigning governance rights to token holders.

The protocol is supported by the trading platform Wombat, and Magpie currently manages about 30% of Wombat's governance power, helping the protocol optimize its various cross-chain DeFi services. As of the publication, Magpie's locked position is 19.16 million US dollars, and the Magpie platform involves two types of important tokens, namely WOM and MGP. WOM is the token of the Wombat trading platform, and MGP is the platform token of Magpie.

Users can deposit their stablecoins, BNB, Liquid BNB, frxETH, ETH, WOM, mWOM into the unilateral pool through this platform to obtain high APR, and at the same time support the governance voting of the Wombat trading platform to earn passive income. And Magpie locks all converted WOM into veWOM on Wombat, Magpie accumulates veWOM in this way, and veWOM entitles Magpie to obtain higher WOM rewards and governance benefits on Wombat.

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Wombat and Magpie

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Magpie Use Cases, Benefits

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Increase rewards for WOM holders

Through Magpie, WOM holders can convert tokens into mWOM to obtain higher returns. This is beneficial for holders to obtain more benefits:

-MGP

-12% WOM Revenue Share

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Increase LP rewards

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provide valid voting rights

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Control WOM circulation supply

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for depositors

First, select your available network (Arbitrum or BNB Chain), select Liquidity Pools, and deposit your available assets. This article uses USDT as an example;

After depositing into the pool, you can see your LP on the interface. After the deposit is successful, your account will start to receive WOM or MGP rewards;

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For WOM stakers

For WOM holders, you need to choose Magpie Pools. There are currently three options. Click to convert the WOM you hold to mWOM.

You can buy WOM through Uniswap, and then convert and pledge WOM through Magpie. At present, the APR of the Magpie Pools is still very good.

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For MGP holders

MGP holders need to lock the MGP held by Magpie and obtain vlMGP at a ratio of 1: 1. The advantages of holding vlMGP are: earning revenue share; earning MGP rewards; maximizing Wombat's voting rights; Magpie's governance benefits ;received rewards confiscated by others; income from bribery. MGP can be purchased through Trader Joe/PancakeSwap.

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Receive rewards and vote

For the claim of Magpie’s income, on the Claim and Bribe of its interface, you can see the share of the income you can receive, and you can complete the claim by selecting the corresponding part to claim.

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Penpie in partnership with Pendle

In addition to working with Wombat, Magpie also created Penpie for Pendle. Penpie is a product launched by Magpie in cooperation with Pendle and currently supports the Ethereum mainnet and Arbitrum.

Similarly, the gameplay of Penpie is similar to Magpie but simpler. Users convert PENDLE to mPENDLE through Penpie to earn PNP income. PNP is the governance token that Penpie will issue soon. The current total deposit of Penpie is 2.41 million PENDLE.

Users who deposit on Penpie will get some benefits:

- Will be eligible for 2% of the total PNP supply. PNP is distributed to users according to the points, and the points are judged as follows:

Deposit 0-1000 PENDLE and convert, each PENDLE will get 1 point;

Deposit 1000-5000 PENDLE and convert, each PENDLE will get 1.1 points;

Deposit 5000-20000 PENDLE and convert, each PENDLE will get 1.3 points;

Deposit 20000-100000 PENDLE and convert, each PENDLE will get 1.6 points;

Deposit more than 100000 PENDLE and convert, each PENDLE will get 2 points.

- When Penpie is fully launched, it will receive an airdrop of mPENDLE, which allows chain breaks between Ethereum and Arbitrum.

Note that PENDLE to mPENDLE is still irreversible. And currently the interface only has one option of pledge.

In the future, Penpie will allow PENDLE holders to earn more PENDLE rewards as passive income, provide Pendle Finance users with cost-effective voting rights, and enable liquidity providers to earn higher rewards without locking PENDLE into vePENDLE APR%.

Opportunity to earn great rewards by converting PENDLE holders to mPENDLE through Penpie. Users can stake mPENDLE on Penpie and get PENDLE income. When a user converts PENDLE to mPENDLE, Penpie will automatically lock the converted PENDLE to vePENDLE in Pendle Finance. This mechanism enables PENDLE holders to earn greater returns through mPENDLE, while also granting Penpie governance rights and higher APR as an LP of Pendle Finance.

The voting rights accumulated by Penpie through its vePENDLE holdings are shared among vlPNP holders, enabling them to participate in the governance of Pendle Finance in a cost-effective manner, which can be locked into vlPNP to obtain its benefits.

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Penpie IDO

Recently Penpie is conducting IDO of its token PNP. The Penpie IDO has an FDV of $3 million and is capped at $600,000 (20% of the total supply), enabling early backers to purchase PNP at a very favorable price.

At present, Penpie IDO has launched a PNP priority access plan for users to obtain priority purchase qualifications, including:

- mPENDLE holders — 30%

-Penpie Liquidity Provider — 30%

-vlMGP holders — 25%

Galxe launch campaign (lucky draw) — 5%

The funds raised by the IDO will be used to:

- 40% of the initial PNP/ETH liquidity: used to ensure a stable and powerful liquidity pool for PNP;

-30% for development and operations: to improve Penpie, optimize its functionality, and maintain smooth, uninterrupted operations;

-20% for marketing and business development: ensuring the continued development of Penpie, raising our profile, attracting new users and developing partnerships;

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Partners and Audits

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audit

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Although the high-yield mechanism launched by Magpie is somewhat complicated, it undoubtedly creates a new type of model for the veToken mechanism, which can bring high profits while enjoying governance rights. At present, it seems that this maximizes user benefits and tokenizes governance rights This method can bring some new things to DeFi, and we also expect that Magpie can cooperate with more projects to bring users more intuitive benefits.