The Hummus Hangout, #1
Welcome to the first in a series of Hangouts where the Hummus Team walks you through the details of the Hummus protocol. We’re going to start with the most basic and probably most important piece–what Hummus is and how it works.
The Hummus Exchange has launched with the following features:
- Swap m.USDC, m.USDT, and DAI with hardly any slippage, even on very large trades.
- Stake m.USDC, m.USDT, and/or DAI single-sided to earn rewards paid in $HUM tokens.
- Stake $HUM tokens to earn $veHUM in order to increase your yield on the staked stablecoins.
- The more $veHUM you have, the higher your boosted yield is.
- The more m.USDC, m.USDT, or DAI you have staked, the more $veHUM you will need to boost your yield.
Let’s take a closer look!
What Hummus Is & How it Works
As you might have already read in our last article, Hummus Exchange is an Automated Market-Maker (AMM) built exclusively for swapping stablecoins on the Metis Andromeda network. We have combined the speed, security, and efficiency of Metis with an ultra-low slippage stableswap mechanism and dynamic staking rewards system.
For users seeking yield, hummus also allows single-sided liquidity provision and allows users to provide unilateral liquidity. The pools can effectively trade more naturally with each other. This is a result of the way the tokens assets and liabilities are recorded by the protocol. The end result? Greatly reduced slippage experienced by end users.
The Hummus Exchange’s design allows for the pools to not only interact which each other but also to be flexible and grow relative to the natural supply and demand characteristics of the market. New stablecoins, even those in their early stages, can be added without the complication caused in existing AMM designs. A much smoother end user experience is the result of these improvements.
The bottom line is that you can swap m.USDC, m.USDT, and DAI with hardly any slippage, even on very large trades.
Earning With Hummus
The backbone of the Hummus stableswap protocol and the initial utility of $HUM is the staking mechanism. Hummus allows you to deposit and then stake m.USDC, m.USDT, and DAI single-sided in its liquidity pools. (“Single-sided” means that the user only needs to stake one type of token, whereas in legacy protocols multiple tokens would typically need to be staked in pairs and subjected to impermanent loss.)
Upon completing the staking transaction you immediately begin earning rewards on your deposit. These rewards are paid in $HUM tokens at the “Base APR” rate shown on the “Pool” page.
But wait, there’s more! Additionally, you can significantly boost your APR by also staking $HUM tokens on the veHUM page. By staking $HUM you will accrue $veHUM on an hourly basis. You can then claim your accrued $veHUM on the veHUM page.
The more $veHUM you have, the higher your boosted APR is. The more m.USDC, m.USDT, or DAI you have staked, the more $veHUM you will need to boost your APR.
Important! If you unstake any amount of $HUM then you will lose all of your $veHUM. That is, you will lose any $veHUM you have accrued on the “veHUM” page and any $veHUM” you have already claimed.
Therefore, the longer your $HUM remains staked, the more VeHUM you accrue, which results in a greater yield (APR) boost. Simple.
After you have earned your $HUM rewards on your stablecoin(s) deposit you can claim your $HUM on the Pool page and the $HUM tokens will then appear in your wallet. You can then stake your new $HUM to get an even higher APR, hodl, or sell it on the open market.
Don’t forget to add the $HUM contract address to your MetaMask wallet!
This Is Just the Beginning
The Hummus team is incredibly excited to launch and is deeply grateful for the support of the Metis team and community. We can’t wait to bring new things to our community and this rapidly growing ecosystem. Stay tuned for part two of our hummus hangouts!