Reward vault Request for BakerDAO Bread Borrowing

Reward Vaults
1

1. Proposer Details

  • Email: masterbaker@bakerdao.io

  • Proposer’s project name: BakerDAO

  • Proposer’s X account (you will be required to make a post from the X account provided for verification purposes): https://x.com/BakerDAO420

  • Affiliation (protocol / one of the tokens in the contract): Both

2. Protocol Details:

  • Protocol Name (Example: XYZ DEX): BakerDAO
  • Protocol Type (DEX/Lending/Staking/Derivatives/Other): Non liquidateable loans and leverage
    • If other: please specify
  • Protocol X profile link: https://x.com/BakerDAO420
  • Protocol docs link: https://documentation.bakerdao.io/
  • Protocol audits links (multiple links): Security | Baker DAO
  • Does the protocol have any relationship with current Berachain validators? Yes

3. Contract/Pool Details

  • Contract Name (Example: $EXAMPLE / $BERA): BREAD-BORROW
  • Contract Address: 0x0F8CB7e0901a328E2F3cAbEc2A8425009444B8e5
  • Reward vault: 0xBe703C50C176336602aEFe48c74e9Cc15426db97
  • Contract Type / Configuration: It is a dummy ERC-20 token that is staked in the reward vault to earn BGT before distributing to users as an LST
  • Describe how the contract works (e.g., how to mint and redeem shares of the contract, if tokens can be exchanged within the contract…):
    • The purpose of this Rewards Vault is to incentivize borrowing activity within BakerDao. The incentives are directly proportional to borrowBalance * sqrt(timeToExpiry)
    • A dummy ERC-20 token is staked in the reward vault, and accrued BGT is used to mint an LST which is then distributed amongst users with an eligible borrow balance
    • Only new borrows after block 5623025 will be eligible
    • Rewards are distributed using the following formula:
      • timeToExpiry = if(endDate > block.timestamp) {endDate - block.timestamp} else {0}
      • weight = borrowed * sqrt(timeToExpiry)
    • Rewards are not directly proportional to fees, and increased activity in the future drives more rewards to those with longer loan timeframes (as long as loan/loop is opened after snapshot block)
    • Reward calculation and distribution is done via Merkl offchain tracking and accounting
  • Contract Fees: Outline the fee structure (e.g., 10% of staking rewards): BakerDAO will retain up to 10% of all LST rewards distributed to users
  • Existing Liquidity / TVL: current liquidity and volume stats (if applicable):
  • Identify any address(es) controlling more than 10% of the contract shares:
  • none
    (address / type: team, protocol-owned liquidity, etc.): The staking token is 100% owned the BakerDAO multisig, where rewards earned are distributed to BakerDAO users with active loans and loops initiated after the snapshot block (block 5623025). Although it is technically owned wholly by BakerDAO, the true beneficial ownership will be decentralized, with protocol users owning the shares. Since only users who open debt positions after snapshot will be beneficial owners, there are none as of yet
  • Is the contract upgradable? No
  • Contract Control: (Multisig/Single Owner/RBAC/Permissionless/Governance): Multisig
  • Additional details on Contract Control: BakerDAO team
  • Is the contract verified? Yes
  • Can the contract be paused? Yes
  • Does the contract rely on oracles? No.

4. Token Details

Provide the following details for each token in the contract (up to 5):

  • Name: Bread Borrowing Staking Token
  • Symbol: BREAD-BORROW
  • Contract Address: 0x0F8CB7e0901a328E2F3cAbEc2A8425009444B8e5
  • Tokenomics, Distribution, and Vesting (links to official docs, website, etc.): Baking and Burning | Baker DAO
  • Identify any address(es) controlling more than 10%
    (address / type: team, foundation, investor, etc.): The staking token is 100% owned the BakerDAO multisig, where rewards earned are distributed to BakerDAO users with active loans and loops initiated after the snapshot block (block 5623025). Although it is technically owned wholly by BakerDAO, the true beneficial ownership will be decentralized, with protocol users owning the shares. Since only users who open debt positions after snapshot will be beneficial owners, there are none as of yet
  • Does the project issuing the token have any relationship with current Berachain validators? Yes
  • If yes, which one? Kodiak
  • Total Supply Cap (if any): N/A
  • Circulating Supply:
  • Token Type:
    (Governance, Utility, Memecoin, Stablecoin, LST, RWA, Other): Other
  • Provide extra details (e.g. Use case, Redemption mechanics, Peg stability): minted and burned for leveraged positions that are opened/closed, and tokens are minted proportionally to fees paid
  • Are token contracts upgradable? No
  • Token Control: (Multisig/Single Owner/RBAC/Permissionless/Governance): Multi-sig
  • Additional details on Token Control
  • Is the token contract verified? Yes
  • Is the token a standard ERC20 or any functions have been customized? (e.g. transfer, balance, mint, burn…): ERC20 with custom functions
    (If custom, provide a link to an audit.): Standard
  • Can the token be paused? No

5. Token / Project Background / Incentive Token Whitelist

Only two tokens can be whitelisted for use as incentives in a Reward Vault. Indicate which tokens will be used and provide all relevant information below.

Required Data for Incentive Token:

Incentive token 1: BREAD

  • Contract Addresses (on Berachain and bridging addresses if cross-chain):
    chain / address: 0x0003eedfdd020bf60d10cf684abac7c4534b7ead
  • Tokenomics, Distribution, and Vesting (links to official docs, website, etc.): Baking and Burning | Baker DAO
  • Identify any address(es) controlling more than 10%
    (address / type: team, foundation, investor, etc.): the BREAD contract itself, as it gets locked there as collateral. The beneficial owners of this collateral can be found in this dashboard https://dune.com/purif/bakerdao. None of these addresses own more than 10% of the locked collateral
  • Does the project issuing the token have any relationship with current Berachain validators? Yes
  • If yes, which one? Kodiak, P2P, Infrared, Berapaw, THJ, Berabaddies, Falcon Nest, ApDAO, Stakecito
  • Total Supply Cap (if any): N/A
  • Circulating Supply: 3.58m
  • Token Type:
    (Governance, Utility, Memecoin, Stablecoin, LST, RWA, Other): Other
  • Provide extra details (e.g. Use case, Redemption mechanics, Peg stability): minted and burned on an up-only bonding curve
  • Are token contracts upgradable? No
  • Token Control: (Multisig/Single Owner/RBAC/Permissionless/Governance): Multi-sig
  • Is the token contract verified? Yes
  • Is the token a standard ERC20 or any functions have been customized? (e.g. transfer, balance, mint, burn…): ERC20 with custom functions
    (If custom, provide a link to an audit.): Security | Baker DAO
  • Can the token be paused? No

Incentive token 2: stBGT

  • Token Contract Addresses (on Berachain and bridging addresses if cross-chain):
    chain / address: 0x2cec7f1ac87f5345ced3d6c74bbb61bfae231ffb
  • Tokenomics, Distribution, and Vesting (links to official docs, website, etc.):
  • Identify any address(es) controlling more than 10%
    (address / type: team, foundation, investor, etc.):
    • Kodiak Island stBGT / wBERA (0xA91576253Fed7a4647c3C9638468C656d0Fa6457)
    • stBGT Staking contract (0xC03226d5d68FEaDa37E0328b2B954acB579a3C9a)
  • Does the project issuing the token have any relationship with current Berachain validators? Yes
  • If yes, which one? Kodiak Stakecito, Coinage x DAIC, InfStones, Validation Cloud, Enigma, TTT VN, NodesGuru, Rhino
  • Total Supply Cap (if any): N/A
  • Circulating Supply: 172,362
  • Token Type: LST
    (Governance, Utility, Memecoin, Stablecoin, LST, Other)
  • If either token is a native stablecoin, LST, or governance token, provide extra details on Use case, Redemption mechanics, Peg stability:
    • stBGT is a transferable version of BGT. It can be LPed, used as collateral, or staked in the stBGT staking contract to earn HONEY staking rewards. stBGT is redeemable for BERA on a 1:1 basis at any time.
  • Are token contracts upgradable? No
  • Token Control: (Multisig/Single Owner/RBAC/Permissionless/Governance): Multisig
  • Additional details on Token Control: Permissionless
  • Is the token contract verified? Yes
  • Is the token a standard ERC20 or any functions have been customized? (e.g. transfer, balance, mint, burn…): ERC-20 with minting and burning
    (If custom, provide a link to an audit.):
  • Can the token be paused? No

Inentive token 3: BERA

Additional Requirements:

  • Specify how many tokens per week you plan to allocate for incentives: $10k worth of BREAD per week initially to bootstrap, and then ongoing with 15% of gross fees accrued from the BREAD contract
  • Specify for how many weeks you plan to allocate incentives: perpetually
  • Outline how decisions about token incentives are made (DAO, multi-sig, etc.): multi-sig
  • Incentive Manager address for BREAD and stBGT: 0xA9592B702e8BBF6485136E94EE84Af263Cc3a69b

6. Growth, Community & Ecosystem Impact

Why This Contract Matters:

  • How will this contract benefit Berachain?
    • This contract further incentivizes users baking BREAD and borrowing against it to create leveraged positions, this locks up large amounts of BERA and removes it from circulation
    • This effect is made more robust due to the use of the decay function for positions nearing expiry and incentivizes renewal
    • Additionally, it generates fees that are recycled into more bribes, creating a consistent and perpetual bribe stream
  • Does it enable important trading pairs that drive adoption or integrate with other Berachain projects? No, but it does drive adoption of bakerDAO which has synergies with other Berachain protocols

Potential Volume / TVL:

  • Provide metrics or estimates on liquidity you expect to attract: There is already $16.24m of notional debt, and this is expected to 3-4x with increased incentives from PoL
  • Highlight any known liquidity commitments. (If you or partners plan to seed the contract, provide proof of funds or a statement of intent.): No pre-commitments

Synergies with Other Protocols:

  • Will this contract feed into any yield aggregators, lending markets, or liquid staking derivatives on Berachain? Yes, this contract has synergies with Kodiak, Yeet, BakerDAO

Marketing / Promotion:

  • Are there plans to co-market with another project to bootstrap liquidity? Yes, co-marketing will be undertaken by BakerDAO, Kodiak, and Yeet

Long-Term Vision:

  • How could this reward vault evolve over time? (E.g., eventually becoming a core liquidity pair or a major stable pool for the chain.): This vault can become a core liquidity method for boosting rewards to users that are long BREAD, and lock up larger and larger amounts of BERA

7. Verification

Please post the following text with the provided X account:

“Submitted Reward Vault Request for [Contract Name] on protocol [Protocol Name] with incentive tokens [incentive token 1], [incentive token 2]”

Insert post link: https://x.com/BakerDAO420/status/1927760931989147861

2
  • Contract Fees: Outline the fee structure (e.g., 10% of staking rewards): BakerDAO will retain up to 10% of all LST rewards distributed to users :face_with_monocle:
3

“Up to” 10% - I believe to incentivize partnerships with particular LSTs / “BreadGT”

1 Like
4

Love the idea. An innovative twist on Pol and a great way to make the Bera ecosystem more appealing.

Let’s bake!

1 Like