Managed Convex, the Right Way
Badger’s Vested Escrow CVX (bveCVX) Vault is a managed CVX position designed to save on gas and optimize income for depositors.
Convex is a significant DeFi yield influence asset as it controls nearly half the voting power in Curve governance, making it essential for projects needing liquidity for their tokens. Since launch, bveCVX has amassed around 3% of the outstanding CVX vote weight, and growing.
Voting with CVX to generate boosted yield requires users to lock their tokens in a governance contract for 16 weeks. bveCVX automates locking of tokens, locking on a weekly cadence. Deposited tokens, as well as any unlocked tokens from a given week can be withdrawn until the next lock. 5% of the vote weight controlled by bveCVX is also used to incentivise bveCVX/CVX liquidity on Curve, providing additional but limited exit liquidity available at any time.
The vault solves a number of problems for Convex holders:
- Automated voting strategy to optimize income and gas consumption.
- Automated reward collection and processing
- Partial liquidity on locked CVX through an incentivized Curve pool
- Autocompounding of vlCVX underlying cvxCRV rewards via our bcvxCRV helper vault.
As approved by governance in BIP 87, the current parameters of bveCVX are as follows:
- Selling 85% vote weight for bribes to buy 75% / 25% bveCVX and BADGER for distribution to bveCVX depositors
- Selling 5% vote weight for bribes to buy BADGER distributed to bveCVX / CVX LPs to maintain liquidity in the Curve pool
- Selling 5% vote weight for bribes to buy treasury bveCVX (operations fee).
- Voting with 5% vote weight for BADGER / WBTC LP on Curve to generate underlying emissions for Badger’s BADGER/ WBTC Vault.