Composable xTORCH Plugins in Hercules
The Hercules xTORCH plugins–led by the native Yield Booster, Dividends, and Launchpad features–add layers of functionality and composability to the big upcoming Metis dApp. And there’s more coming 👀
What are xTORCH Plugins?
If you’re not already familiar with the relationship between TORCH and xTORCH and the multifarious utility of xTORCH then head over to the Hercules docs site for a refresher or stop by our Telegram or Discord channels.
xTORCH plugins are sophisticated modules (i.e., web2 front/backend + web3 smart contracts) that interact directly with the xTORCH contract. xTORCH holders, be they individual users or protocols, can use these plugins as customizable building blocks within the DEX to create flexible, complex strategies.
Additionally, external developers can integrate their own plugins after a whitelisting process, creating even more opportunities for xTORCH holders and Metis ecosystem users.
Natively Created Plugins
Let’s have a close look at the native Hercules plugins; that is, the plugins developed by the Camelot team:
- Dividends
- Yield Booster
- Launchpad
The Dividends Plugin: Profit Sharing
Users allocating xTORCH to the Dividends plugin are entitled to the redistribution of the Hercules platform’s earnings in the form of “dividends.” Dividend payouts can take the form of one or more types of tokens like USDC & METIS, providing a diversified value stream to users.
Dividend distributions are segmented into weekly “epochs,” each lasting seven days. An epoch is a bit of a term of art in DeFi, but it really just refers to an established recurring period of time.
During these epochs, the reward tokens are proportionally distributed among users based on their and others’ xTORCH allocations in the Dividends plugin. Importantly, the flexibility of this system allows users to unstake from the plugin at any time.
Yield Booster Plugin: Amplify Your Earnings
By staking xTORCH to their staked position NFT (spNFT), users can significantly boost their APR rewards derived from liquidity farming. It is important to note that this boost is exclusively applied to farming incentives and does not influence LP trading fees or other pools such as Nitro/Genesis.
The mechanics of the Yield Booster plugin are designed to incentivize optimal and diverse allocation of xTORCH. The total amount of xTORCH assigned to a liquidity pair (say, METIS-WETH) inversely affects the APR boost. That is, a pair with a relatively small total xTORCH allocation leads to a higher APR boost, while a pair with a relatively large xTORCH allocation results in a lower boost. For an individual user who has yet to allocate xTORCH in the yield booster, s/he will see a higher boost APR available in the former situation than in the latter situation. Other factors affect the calculation, as well.
The typical yield boost plugin multiplier will usually be at the 2x. The protocol caps the maximum boost multiplier at 2.5x.
Launchpad Plugin: We Have Liftoff! 🚀
The Launchpad plugin is a custom-built launch platform for the newest Metis projects. By staking xTORCH in the Launchpad plugin, users gain access to exclusive airdrops, whitelist spots, discounts and other opportunities from new apps launching on Hercules.
When a user stakes xTORCH in the Launchpad plugin it initiates a 30-day lock during which that user cannot deallocate their xTORCH. If the user stakes more xTORCH the lock period restarts the 30-day timer.
The amount of xTORCH staked determines the share of rewards, with a higher allocation translating to a larger share. It’s important to note that the reward distribution is dynamic; it adjusts based on the total xTORCH allocated to the plugin, ensuring a fair and proportional distribution system.
Each project within the Launchpad can customize its launch reward system.
Third Party Integrations 🧩
The Hercules xTORCH allocation mechanism is built so that any protocol or user can provide their own plugin. Such xTORCH allocations will need to be handled through the xTORCH token contract. More generally, community plugins must comply with some technical requirements.
Coming Soon
Careful readers of the Hercules docs might have already noticed the next native plugin in development. Keep up with our socials for more information.
