Strategies boost algorithm

"Value" in this text refers to amounts denominated in the same unit, typically USD or a specified token

The boost algorithm is as follows:

After each liquidity addition, a user's fixed pool share is calculated as:

$$S_u=\frac{LP_{deposit}}{TVL}$$

Where $LP_{deposit}$ is the value of deposited tokens and $TVL$ is the value of all pools across all chains.

If the user already has a non-zero $S_u^{}$ then the new share is added to the old one:

$$S_u^{'} = S_u + \frac{LP_{deposit}}{TVL}$$

If the user withdraws $LP_w$ amount of tokens out of his total $LP_u$ amount of liquidity then the $S_u$ is updated accordingly:

$$S_u^{'}=S_u\frac{LP_w}{LP_u}$$

At any moment of time a user's working balance is defined as:

$$WB_u = S_u \cdot TVL$$

At the end of a reporting period (one day), we have:

• $WB_u$ — the time-weighted value of the working balance of the user u;
• $D_{u,s}$ — the time-weighted value of the deposit by the same user in strategy s;
• $APR_s$ — the annual percentage rate (APR) of strategy s

The user's total allocation over which the boost value calculated is:

$$D_{u} = \sum_{s} D_{u,s}$$

1. User Boost Factor

$$\beta_{u} = \min\left(1,\; \frac{WB_{u}}{D_{u}}\right)$$

• 10k in the pool and 100k in strategies → β = 0.1.

• 20k in the pool (or more) and 20k in strategies → β = 1 (full boost).

2. User–Strategy Position Weight

$$W_{u,s} = D_{u,s} \cdot APR_{s} \cdot \beta_{u}$$

• APR sets the priority between strategies.

• A single β applies to all of a user's strategies.

3. Token Distribution

Let $R$ be the total amount of tokens to be distributed during the period. Total weight:

$$W_{\text{tot}} = \sum_{u} \sum_{s} W_{u,s}$$

The reward that should be allocated to a user for a specific strategy:

$$\text{Reward}_{u,s} = R \cdot \frac{W_{u,s}}{W_{\text{tot}}}$$

If the allocated reward exceeds the reward corresponding to the baseline APR, it is capped at the baseline reward amount:

$$\text{Reward}^\text{baseline}_{u,s} = \min\left(\text{Reward}_{u,s},\; D_{u,s} \cdot APR_{s} \right)$$

The algorithm starts with the users with the highest $W_{u,s}$, in the case where their reward exceeds the baseline the leftover tokens are simply counted towards the remaining $R$