Introducing: Savvy’s Arbitrum STIP Incentive Rush — Use Savvy, and get ARB.

After careful planning and fine-tuning, Savvy is happy to introduce the full details of its 200,000 ARB distribution under the Arbitrum Short-Term Incentive Program (STIP). Each part of the distribution is designed and carefully calibrated to directly enhance a certain part of the Savvy Flywheel.

Sustainable Deployment of Incentives

Understanding the mercenary nature of directly incentivized liquidity pools (LP) based on our experiences from the STIP co-incentives received from ecosystem partners over the last two months, Savvy is adopting a much more nuanced strategy toward a sustainable liquidity framework. Savvy’s STIP plan involves moving a substantial part of its LP incentives into other solutions that are modeled to have significantly higher return-on-emissions (ROE), generate higher protocol-owned liquidity (POL), and increase collaboration and transaction volume within the Arbitrum ecosystem.

Savvy’s STIP grant will be deployed under three key areas; on-chain bonds, Savvy Booster incentives, and direct LP incentivization to keep up with the increasing volume through svToken liquidity pools.

By carefully balancing incentives, Savvy aims to load-balance market dynamics on SVY and svTokens while driving value and utility within its entire ecosystem by ensuring attractive APRs for liquidity providers, deepen the SVY-ETH liquidity pool through the bond program, and increase the utility of SVY token.

Here’s a closer look at the rationale behind STIP and how it plans to elevate the Savvy ecosystem.

Launching the Bond Program with Sushi

At the forefront of STIP is the launch of the SVY-WETH LP/ARB bonds, a pioneering collaboration between Savvy, SushiSwap, Bond Protocol, and Steer Finance. This initiative is especially a proud moment as Savvy is one of the few select projects that are going to debut the first oracleless, dynamically priced bond product to the market. The parameters of this program have been carefully modeled and tuned with the help of multiple think tanks including Serious People and the Savvy team.

Participants are offered ARB tokens at a discount from the market rate with a 7-day maturity in exchange for providing SVY-WETH liquidity on SushiSwap. To engage in the bond program, participants need to pair equal monetary amounts of SVY and WETH on SushiSwap, creating LP tokens that can be bonded through SushiSwap’s interface.

This opportunity is particularly appealing for those looking to acquire and hold ARB long-term at below-market rates. The program is designed with a cap of 115,000 ARB, featuring a 7-day maturity period for payouts, emphasizing its exclusivity and potential for quick uptake.

Adding a new boost: STIP Booster joins Savvy Booster

Following closely behind, Savvy will allocate 40,000 ARB towards the Savvy Booster, aimed at repaying open credit lines faster in relation to the amount of veSVY a user has which is earned by staking SVY. For the calculation of this incentive bracket, only the veSVY accrued from a very near date before the deployment of the ARB Booster will be used to create a level playing field for new users. This part of the STIP allocation is designed to create direct incentivization of the usage of the Savvy protocol and increase utility to SVY tokens inside the Savvy Ecosystem.

Deepening Stableswap Pools

The final 45,000 ARB of Savvy’s STIP grant will be allocated to incentivize LPs across five key liquidity pools on Uniswap, Balancer, and Camelot. This comprehensive approach seeks to deepen liquidity and enhance the overall health of the Savvy ecosystem as the system capacity increases due to the bond program and the increased firepower of the Savvy Booster.

Conclusion

Savvy’s strategic and novel implementation of STIP, starting with the bond program in collaboration with Sushi, represents a thoughtfully designed effort to enhance the platform’s liquidity and trading dynamics. Through this program and its associated initiatives, Savvy is looking to kickstart the flywheel that would provide a robust and sustainable ecosystem that benefits all stakeholders.

We are glad that you are around for the ride.