Name: [WIP #3] - A United Front: Abracadabra + Wonderland Merge
Wonderland is consistently using Abracadabra cauldrons and builds strategies which are used by Abracadabra’s degenbox. Both projects have interconnections from cauldron usage, liquidity provision, incentive voting on Curve to boost MIM liquidity, to building unique degenbox strategies around yield farms.
When analyzing Abracadabra’s and Wonderland’s strengths and weaknesses it becomes clear that their partnership significantly increases both protocols’ ability to perform.
The Abracadabra and Wonderland teams, including Sifu and Dani, see considerable synergy in merging the two protocols together under one token - SPELL.
The following proposal is looking to showcase what such a merger looks like and the benefits of uniting both protocols and communities.
Further unify the frog nation through this merger and have access to a lending market (Abracadabra) which can offer us the kind of deals which allowed us to get 100% yield on stables. The team expects this partnership to further our ability to provide the best yields in defi.
Provide a High Level Overview:
@danielesesta will be hosting an AMA at 12PM EST, 17:00 UTC on his twitter profile to share more insights about the merger!
By combining Abracadabra’s lending infrastructure with Wonderland’s well diversified treasury and yield producing strategies, incredible performance efficiencies can be achieved.
The treasury will have direct access to cauldrons and can deploy strategies from within. One of Wonderland’s strengths lies in creating unique yield strategies which use Abracadabra’s cauldrons to maximize performance. With this merger, these strategies can be developed and deployed in house, making them faster, more efficient and taking a bigger market share across the entire sector.
The unification of Abracadabra and Wonderland will create the most powerful DeFi entity in the industry.
The merger would bring Wonderland’s large treasury worth +$800M USD in tokens over to Abracadabra, including making use of Wonderland’s valuable strategy of protocol owned liquidity, completing its goal of becoming self-sufficient and a zero-emission protocol by eradicating the need of incentivizing liquidity.
The merged Wonderland community and token holders will benefit from holding the SPELL token, which will in addition to receiving their rewards from cauldron fees, also start receiving revenue share from the treasury which boosts the APY on sSPELL.
The SPELL token is listed on all major exchanges, including Coinbase, FTX, Binance and many more. SPELL has deep liquidity and market makers creating a smooth trading experience across centralized and decentralized exchanges.
The merger will substantially increase the treasury’s ability to obtain yield, through directly working on cauldrons and pushing strategies to degenbox.
Overall combining the protocols will turn SPELL and specifically sSPELL into a governance token which controls cauldrons, MIM replenishments, a $800M treasury and receives revenue share from yield producing assets.
The ability to deploy cauldrons with new strategies and using assets in the treasury to generate yield from them, to distribute to sSPELL holders will elevate APY for the entire protocol.
Owning a large treasury will give the merged protocol the ability to diversify into early stage token investments as well as funding and building new projects.
Creating even deeper liquidity around MIM will allow a wider expansion into new markets while increasing usage of cauldrons.
With this merger Abracadabra will become a zero emission protocol with a $800M productive warchest that can be utilized to generate yield using in house strategies and cauldrons.
Provide Low Level Details:
The proposal is to use 98B SPELL tokens, from Abracadabra Treasury to acquire Wonderland Money Treasury in full and merge the two projects completely. The minted SPELL tokens are mostly derived from future farming incentives as you can see in the chart below.
Where do the SPELL tokens come from?
Currently the tokenomics of Abracadabra are as follows:
63% (132.3B SPELL): Global Farming Incentives (13,991,260,380 burned over multiple times)
30% (63.0B SPELL): Team allocation (4 Year Vesting Schedule)
7% (14.7B SPELL): Initial DEX Offering
How Will the Merge Work:
Every wMEMO token represents ownership over a part of the Wonderland Treasury. The merger involves the Wonderland treasury being acquired by Abracadabra.
This means that wMEMO holders will change ownership from Wonderland to Abracadabra by exchanging wMEMO to SPELL.
The wMEMO Cauldron:
CDPs will be automatically migrated and you will be seeing your opened position on Abracadabra.
Closing your position will return SPELL at the determined migration exchange rate.
How to perform the direct wMEMO to SPELL swap?
A swap interface will be implemented on the Wonderland site which facilitates this exchange with 0% slippage.