Gravity News

The following post is an exact retelling of a council approved proposal focused on graviAURA regulations.
Dearest Council,
The dust has settled on most of the balancer voting, and per my request our gauges still have 2 more days to go.  Now that we have seen where things landed, we can take a moment to think a little deeper into what everything means.
<h3>Primer:</h3>
<ul>
<li>auraBAL: 80%/20% - BAL/ETH locked in Aura (irreversible)</li>
<li>graviAURA: Badger Locked AURA</li>
<li>graviaAURA Balancer Pool: 33% / 33% / 33% - graviAURA / wETH / auraBal</li>
</ul>
<h3>Current State:</h3>
<ul>
<li>There is a ton of auraBAL sitting in a stableswap (auraBAL / B-80BAL-20WETH) that is hard to trade due to complex routing through nested pools on Balancer.  There has been ver limited  trading in this pool as of this writing</li>
<li>The only functioning pool offering single transaction auraBAL swaps for any token is the $17k USD seed liquidity in our graviAURA pool</li>
<li>Users are depositing into auraBAL instead of arbing the pool back to peg even though there is reasonable liquidity, demonstrating that most are not figuring out how to trade auraBAL</li>
<li><a href="https://badger.com/graviaura">graviAURA</a> is a powerful tool, and it needs some regulation.  Especially in a nascent ecosystem like AURA.  At the same time, we are eager to start testing and learning with it and there is a real need in the ecosystem that can be resolved by a currently running governance request</li>
</ul>
<h3>Summary:</h3>
<ul>
<li>Our goal is to gain the respect of that community by demonstrating our partnership healthy growth of their ecosystem.</li>
<li>Getting the auraBAL gauge up will solve a real problem that is limiting the growth of AURA.</li>
<li>The auraBAL pool will allow arb of the stableswap pool and will provide a quick solution to good UX, while still taking advantage of deep auraBAL stableswap liquidity.</li>
<li><a href="https://docs.google.com/spreadsheets/d/1GUoDUeq9W4YV90_OK-Z83WK-p977goLDFQcjZ_cvSxo/edit#gid=0">Recent modeling</a> shows auraBAL will yield more than 150%.</li>
<li>The Balancer community understands that this would create outsized influence and limit competition.</li>
<li>The last few months have shown that ve tokenomics+ free market bribes when left unchecked can create bubbles.</li>
<li>Along with Solarcurve’s plan to feed USD into the bribe environment and encourage voting on pools that benefit the ecosystem, we believe this is a powerful tool that can be used to build and maintain a sustainable economy.</li>
</ul>
<h3>Proposal:</h3>
I hereby request that the council limit the the auraBAL/ETH/graviAURA pool voting as follows:
Rounds 1, 2, 3:
<ul>
<li>
⅔ of the graviAURA in the pool will vote for itself and Badger will collect 10% fees
</li>
<li>
The remaining votes (~ ⅓ ) will be split as follows, with no fees as altruistic voting
<ul>
<li>50% to the stETH/ETH pool</li>
<li>50% to the Aave USD 3pool</li>
</ul>
</li>
</ul>
During the first round attention will flow to this pool because of the good yields. In rounds 2 and 3 other pool depositors will also begin to vote for this pool and it will find its natural yield.
<h3>Subsequent Rounds:</h3>
<ul>
<li>We will target a return that is 20% APR higher than the yield of the highest auraBAL pool is yielding at the start of each voting round.  Note that target yield will be based on emissions generated by self voting, so external voting by depositors may push yields above the natural target.</li>
</ul>
<h3>End Game:</h3>
Building a regulatory framework around graviAURA and setting the parameters of that regulation are something that is best handled by shared governance between Balancer, Aura and Badger. Hopefully this joint governance will be established to manage emissions going forward.
With this approved by the council, I can approach some members of the AURA and Balancer teams and see if perhaps we can find a way to get graviAURA and auraBAL trading, and give Badger a chance to start working with our new tech.
Note that Badger will be launching an Aave USD Helper vault (details soon) so users will directly benefit from alutiristic voting.
Do you approve?
<a href="https://discord.com/channels/743271185751474307/842854176488161311/993524489755312280">https://discord.com/channels/743271185751474307/842854176488161311/993524489755312280</a> [BadgerDAO discord]
<img src="https://lh4.googleusercontent.com/KU3WwnfjAvFlF2CDUkZpTOGJAdjoQdvrMye65WfxqI7eQNc74wLwQtn-_jMEDk9fZ7VN2u9wAEpwJhL8P0OejhoB_wJ7_6kwmE77xJVKX2aWExYdthKmuSCGKF89U58kF4ITUoy9W_I_" alt="">
<img src="https://lh5.googleusercontent.com/f2M9xIV29bVjZHXPE9O0Sbf0pmNPazu7rHKOPP0DFPE8AKz-suxs8oruLxnQDJes2UdKxvKbWY-jW3T_EHzcWGYQ4xnyeVhKd8pXlWGNV6jJFCpBJoV4d6dklxw8drdLPP_fWuXR3wYU" alt="">

The latest in the initial development of graviAURA regulations.

graviAURA Regulation: First Steps

<img src="/images/uploads/gravidock.png" alt="">
On June 16th, <a href="https://aura.finance/">Aura Finance</a> (a Convex-like layer on top of the <a href="https://balancer.fi/">Balancer AMM</a>), launched with an initial airdrop and encouraged users to deposit their vote-locked veBAL (forked from veCRV) tokens to bootstrap farming pools.
Aura has now opened up for deposits of 80-BAL/20-WETH BPT tokens which it will perma-lock and mint auraBAL for depositors. The goal of Aura in relation to Balancer is much like the goal of Convex to Curve, to create a richer and more efficient governance layer on top of the base protocol’s ve-style token distribution. If successful in accruing a large amount of locked BPT, AURA tokenholders will have significant influence over the BAL token distribution.
Ahead of this launch, Badger has been hard at work developing <a href="https://badger.com/gravity">Project Gravity</a>, a new product division focused on yield influence tokens such as CRV, CVX and now BAL and AURA.
graviAURA
As its first product, Gravity presents to you: <a href="http://www.badger.com/graviaura">graviAURA</a>, a semi-liquid locked AURA token designed to support its own liquidity on Balancer.
graviAURA is a bribe-harvesting token similar to bveCVX, but with a very different strategy for how it provides exit liquidity to holders and a different use-case for DAOs that will be highlighted over the next few months.
Just like bveCVX, AURA deposited into graviAURA will be locked and then every 16 weeks be unlocked for 1 week. During these periods where there is unlocked AURA there is the ability to withdraw from the vault. While tokens are not immediately available, in any 16 week period the vault can be completely withdrawn.
graviAURA is very similar to bveCVX in its ability to harvest locked AURA yield from both protocol emissions and bribe harvesting, but the flexibility in Balancer pools will allow it to have even further utility for pool depositors, projects with native tokens, and beyond.
AURA holders can deposit their AURA into graviAURA and earn yield from auto-harvested bribes as the ecosystem develops.
DAOs can include graviAURA in Balancer pools they create for set-and-forget liquidity incentive for their pool since graviAURA automatically votes for Balancer pools it is included in.
Security &amp; Audits
As of today, graviAURA has been reviewed internally and has moved into a final <a href="https://code4rena.com/">Code4rena</a> review. Badger’s underlying Vaults 1.5 tech powering thegraviAURA vault was recently audited by Quantstamp.
Per standard security practices &amp; protocols, graviAURA has been launched in a guarded state for a period of at least 1 week with a total vault cap of 500,000 AURA. A decision to unguard the vault and remove caps will be made once the C4 results have been issued.
Bootstrapping Incentives
To bootstrap graviAURA, a budget of 25,000 BADGER has been allocated to  emit to lockers. It will be paid out at a rate of 2000 a week during guarded launch, and 5,000 a week during full open launch. Emissions will end when the BADGER runs out, and remaining BADGER for the last week will be evenly spread out over that week.
The goal is to incentivize AURA holders to deposit these assets into graviAURA to quickly bootstrap both the AURA and graviAURA ecosystems. These resulting yields will be paid out to anyone holding graviAURA in their wallets starting on June 17th 2022. The BADGER will be emitted 50% flat and 50% boosted based on your BADGER holdings. You can learn more about <a href="https://badger.com/products/badger-boost">Badger Boost</a>  and hop into the <a href="https://discord.gg/badgerdao">Discord</a> if you have further questions,
This is a new ecosystem so graviAURA is an opportunity to learn and build together. The vault will evolve over time as the bribe environment develops. The end goal is to help create an AURA/veBAL ecosystem with significant returns for individual holders and both sustainable and affordable liquidity for DAOs.
Risks
Gravity hopes to encourage early adopters to learn about and participate in our system, but there are some important risks that users should be aware of:
<ul>
<li>Liquidity: graviAURA that is deposited in a Balancer pool will vote for that pool instead of earning bribes. This means that as we get graviAURA gauges up, more and more graviAURA will become liquid on the market and trading will become available. It also means that there will not be much direct withdrawal capacity or liquidity depth until the initial gauges are up and hold significant deposits or tokens start to unlock in 16 weeks.</li>
<li>Gauges: The approval of gauges depends on Balancer governance. Gravity has been working hard to build and maintain good relationships with both the Balancer and Aura communities and feels confident in our ability to agree upon and launch  acceptable gauges quickly.</li>
</ul>
The main user-facing feature of graviAURA is its automatic bribe harvesting for yield generation. The yield of this feature depends on there being a bribe environment, there being bribes in that environment, and Gravity having the voting tech in place to vote for these bribes.
As we presently understand it, <a href="https://hiddenhand.finance/">Hidden Hand</a> is currently working to establish a bribe environment that will generate these user facing yields. As this environment is established, small changes to the strategy and voting engine may be required to integrate.
BadgerDAO has timelocks and strict review processes which may result in missing the initial bribe round. In this event, BadgerDAO will vote with 100% of its voting power for the AURA/ETH and auraBAL/BAL pools at a weight specified by an emoji vote in the governance channel of the AURA discord.
Ape Together Strong
Project Gravity is very excited to open this bootstrapping event and to welcome early adopters who are looking to build good yield solutions that work in both bull and bear markets. Aura and veBAL as a robust and growing early stage ve-ecosystem and are delighted to invite users to learn and build with us.
Before you ape on this one, take some time to understand it. The <a href="https://discord.gg/badgerdao">Badger Discord</a> is full of elder Badgers who can explain how all this stuff works.
Come build with us!
<ul>
<li>Discuss in <a href="https://discord.gg/badgerdao">#gravity</a> in our discord or find us on the <a href="https://discord.gg/aurafinance">Aura discord</a>.</li>
<li><a href="https://twitter.com/badgergravity">Follow the gravity project on Twitter</a> for updates about the aura ecosystem and how graviAURA is adapting to them.</li>
<li>Learn more about <a href="https://badger.com/gravity">Project Gravity</a> on our blog</li>
<li>Read the <a href="https://badger.com/graviaura">graviAURA product spec</a> here</li>
<li>Find the <a href="https://docs.badger.com/badger-finance/vaults/vault-user-guides-ethereum/graviaura-vote-locked-aura">gitbook document here</a></li>
<li><a href="https://app.badger.com/vault/aura-graviaura">Deposit here</a></li>
</ul>

 On June 16th, Aura Finance (a Convex-like layer on top of the Balancer AMM), launched with an initial airdrop and encouraged users to deposit their vote-locked veBAL (forked from veCRV) tokens to bootstrap farming pools.

The 5 week graviAURA bootstrapping event

<h2>Introduction:</h2>
BadgerDAO was founded over a year ago with the mission to bring BTC to DeFi.
Over this time, incredible amounts of BTC have found DeFi. Trying to support decent yields on hundreds of millions of dollars of single asset BTC that had very low trading volume or other utility demands tended to be based on limited governance token alpha. It has been like squeezing blood out of a stone.
That stone has bled a few times, for a while, and when it did we learned a lot. Our biggest successes came from our time in the Curve Wars, and from that, we have developed a specialization in understanding and working with influence meta-governance tokens (CVX, OXD, SEX, AURA, etc).
Since the beginning of 2022, Badger has been quietly testing and learning with our influence tech, and the voting dynamics it enables. Following a period of bveCVX restructuring concluded by <a href="https://forum.badger.finance/t/bip-87-bvecvx-restructure-voting-strategy-and-emissions-revised-with-community-feedback/5521">BIP-87</a>, Badger core team member Tritium rallied some teammates to launch our next experiment, bveOXD. Following the launch, the crew moved on to thinking around Balancer. We’ve consolidated those learnings into a new product that we think has the potential to have a lasting impact on the way DeFi thinks about ve.
We therefore present to you Gravity, a project powered by Badger Tech, advised by Badger Economics, and governed by the $BADGER token. Gravity will focus on ve and influence-based insights, analytics, and products.
<h1>The Discovery Of Gravity</h1>
<h2>Chapter 1: bveCVX</h2>
<h3>An apple fell on our head (what comes up must go down)</h3>
<img src="https://lh4.googleusercontent.com/Jf7ps5V0aDee072EoqK2l6wkmD9ntbDTexLd9oDr2wgUytQQMGmGoDhBGY9hBHaAqzW_9JrKjVRMuRiI6uUnGlIQHUYWGloo7ipzMpViivAE0VYa_xGMebu_NTGUB6ZBzumCu7KbnBKDLFOdUQ" alt="">
bveCVX started as an attempt to create sustainable yield on BTC. When we started building it, there was not really a bribe environment for CVX, and lots of retail holders were looking for a way to make income. bveCVX was designed as a system whereby BADGER would be paid to bveCVX stakers at a fixed APY in exchange for the vote weight. The vote weight would be used to vote for our ibBTC pool, which we would collect fees on from a yield farm we built on top of it.
This worked for a little while. Then the bribe environment grew to an extent where BADGER could no longer afford to pay competitive yields on sufficient amounts of CVX to support the hundreds of millions of dollars in BTC in the Convex pool. That, together with the fact that a decent amount of ibBTC liquidity sat outside the Badger app, and a lot of ibBTC liquidity in the app didn’t hold any significant corresponding amount of bveCVX, made BTC yields fall and bveCVX users unhappy.
After months of work with the BadgerDAO community and <a href="https://forum.badger.finance/t/bip-87-bvecvx-restructure-voting-strategy-and-emissions-revised-with-community-feedback/5521">governance</a> to find the right product/market fit, bveCVX has become a best-in-class product for earning autocompounding yields with liquid locked CVX that no longer has anything to do with BTC.
Our first attempt at BTC supporting bveCVX taught us about the Golden Ratio, in that it had no capacity to maintain it. Badger’s First Law of Yield Gravity states:
“To sustain yields on a pool  in a VE environment relative to emissions curves and token values  of the underlying rewards,  one needs a fixed  ratio between  the value in voting influence tokens and the  total value of liquidity one wishes to support.”
The DAO that has done this the best with CVX is <a href="https://frax.finance/">FRAX</a>, based on the way they algorithmically tied bribes, their own TCL, influence farming and vote management together.
<h2>Chapter 2: bveOXD</h2>
<h3>Centrifugal Forces<img src="https://lh3.googleusercontent.com/HKfQKwBBwl_ghzoktVPH39JjaQwmW5bJSDxYODo1HPzJLO-U9oPdbvPf9tS5feNYicx4ie3B0PF5ZLsH-ZUE8Ky7QqB4l0mDAsVxZN11F6fEROoZdwZbY1-6iEC56Nc1Z8DlJOJZeXp7WBeMgg" alt=""></h3>
We were interested in if there are ways to enforce a Golden Ratio, and/or build up a pool of free vote weight that the DAO could use to create an ecosystem and drive revenues to vaults we could either collect fees on or farm with our treasury. The Solidly experiment provided good ground for this, as it allowed permissionless gauges.
To experiment with this concept we launched bveOXD. bveOXD is different from bveCVX, only in how it votes. bveOXD votes with 100% of its vote weight for OXD/bveOXD LP. This voting dynamic was an attempt to fix the Golden Ratio at 50/50 and see how quickly it could grow and what would happen.
The end game with bveOXD was to have it grow large and become influential. Then to move to a voting system whereby DAOs could pair their tokens with bveOXD, and it would match their voting on that pool. The goal here was to become a center of gravity and a routing pair whereby DAOs could have a cheaper and easier way to bootstrap liquidity that collectively would create a potential AMM routing topology allowing efficient routing between bveOXD paired tokens.
In the end, the whole SOLIDLY experiment fell apart. There were critical problems with the fee and bribe allocations and the UI left a lot to be desired. There were way too many tokens given out in an airdrop, and farmed in the first short liquidity mining  event, leaving very little token supply for future emissions.
As a result, the market ended up flush with SOLID and OXD and the relative emissions became worthless. Despite all of that, and only launching just before the drop off in emissions with no startup capital or initial veNFTs, bveOXD still votes with 1.8% of all OXD for OXD/bveOXD LP each voting round and provides a sustainable source of yields in one of the most very micro of all ve-Ecosystems. It never moved beyond voting for its own pool.
<h2>Chapter 3:  Gravitons and Angels</h2>
<img src="https://lh3.googleusercontent.com/eH_iEdRy8eCuV_UUk6yLEYn4QaGhfDjpsQDZkjBrlio705jLEI0rNFYVLrrWt0b-tHovkVT0cBCvSUMnHROi2955-5-bISH2F2MPT3URy7MshzPDpzhL6J8Dlkkur8zBL80V3ssz2YJYRFatQQ" alt="">
We found the Golden Ratio of 50/50 explored in the bveOXD experiment interesting but not very versatile. It doesn’t allow Liquidity Pool creators to create liquidity between two or more tokens, and instead only allows a single “Solar System”, in which everything orbits around bveOXD.
Since the launch of bveOXD and veBAL, a graviton enthused group from the Badger Core team  has been busy trying to find a simple and versatile gravitational solution.
Something that can operate at the “base layer” and be used by other DAOs and anyone in the ecosystem to integrate all of our learnings over the past year into a source of sustainable liquidity and yield.
<h2>Presenting graviAURA (Formerly known as bveAURA)</h2>
<img src="/images/uploads/miro.png" alt="">
<img src="" alt="">
Aura is a Convex-type layer on top of veBAL, which is a fork of veCRV running on top of the Balancer AMM. <a href="https://badger.com/graviaura">graviAURA</a> is an influence vault that, beyond bribe harvesting for individual users, votes for whatever Balancer (BPT) pool it is in. This allows for pools with variable Golden Ratios, that will be maintained by the underlying logic of the Balancer AMM.
Imagine a WBTC/ETH/graviAURA pool where 20% of the pool was always graviAURA, and ETH and WBTC both had 40%. If all the graviAURA in the pool (20% of the pool value) always voted for that same pool, the long-term yields would never fall below the value that 20% of the total AUM in the pool in AURA directed in a given unit time.
With AURA launch imminent, it is time to start educating fellow students of the gravitational arts about our new discovery, and about our new Product Division. We will be ramping up comms on a number of new channels dedicated to the Gravity Labs. As we do so, we will continue to work with our fellow students to launch our MVP on Aura/Balancer, do a bit of research, and analyze and publish the results.
Then, assuming our well-thought-out theories prove correct, we shall share our creation with the world, and allow all DeFi builders to simply integrate gravitational forces into their liquidity and yield farming strategies. Upon the emergence of such a complex system, there are also interesting learnings and investigations that can be done on “meshed” routing topologies between bveAURA-containing liquidity pools.
<h1>Learn with us:</h1>
Discord Channel:  <a href="https://discord.gg/badgerdao">https://discord.gg/badgerdao</a> (#Gravity)
Twitter Feed: <a href="https://twitter.com/BadgerGravity/header_photo">https://twitter.com/BadgerGravity</a>
Blog: <a href="https://badger.com/gravity">https://badger.com/gravity</a>

Introducing Gravity: An influence (ve) focused product division of BadgerDAO