# Swap and LPs

Last updated

Last updated

LP: Points, yield, CHESS incentives and trading fees

Each fund comes with an AMM pool of the Stable token and its underlying asset. Users receive LP tokens by providing liquidity to the pool. The LP token holders collect a basket of yield including four parts:

CHESS rewards: Weekly CHESS emissions decided by weekly governance voting.

Depending on the projects and the nature of the collaboration, some LP pools might receive additional weekly CHESS incentives. **Currently, the LPs of STONE Fund 2 receive an additional weekly CHESS incentive of 150,000. **

Trading fee: 0.05%.

**Note: the % shown under “Yield details” beside “Trading fee” is the yield percentage, not the fee itself.**Interest: Partial interest from Stable. Example: If one LP token consists of 0.6 Stable and the Stable has an APR of 6%, the LP token would earn 0.6* 6 = 3.6% interest.

You can add or withdraw liquidity anytime in pairs or single assets.

Tranchess borrows the underlying from the AMM pool. These underlyings, together with the ones users paid, are used in the Primary Market to create QUEEN, which is then split into Stable and Turbo. The Stable is returned to the AMM pool and Turbo to the users.

*When most users are swapping for Turbo, Stable could be trading at a discount in the AMM pool.*

Tranchess borrows Stable from the AMM pool. Combining it with the Turbo that the user is selling, these assets are merged into QUEEN, which is redeemed in the Primary Market for the underlyings. After sending the user their amount of the underlying tokens, the remainder is returned to the AMM pool.

*When most users are selling Turbo for the underlying asset, Stable could be trading at a premium in the AMM pool.*

Trading Fee Split

0.05%, of which 80% goes to liquidity providers, 10% to treasury, and 10% to veCHESS holders in the form of rebates.

The prices on the website for Turbo and Stable are the current traded prices, which means that for anyone who wants to swap between the underlying asset and Turbo/Stable, this is the price that will be applied to their trades (not taking into account the potential slippage and price impact of the AMM pool).

Turbo and Stable have another set of "pricing systems": the Fair Values. Fair value **only** calculates the interest earned/paid over time. You will see how much the current traded price deviates from its fair value when you place the order:

**When the fund reaches maturity, you will be redeeming your tokens by its fair values and fair values only. **

Let's use the STONE fund for example.

With an interest rate of 6%, when the fund ends, each Stable will have a fair value of around 1.03. When Stable is trading at a discount (i.e., its traded price is lower than its current fair value), its actual yield will be higher than 6%. For example:

Assume on day 1, the price of Stable is 0.9 STONE, the actual yield (calculated in simple interest) will be (assume the fund lasts for 180 days exactly):

$\frac{（1.03 / 0.9 - 1）}{180} * 365 \approx29.29\%$

At any time before the fund is over, Stable's implied yield is:

$\frac{（FinalFairValue /currentTradedPrice - 1）}{FundRemainingDays} * 365$

STONE

staYSTONE2-STONE

2X, or 2.5X for Fund 1 users

Scroll Marks based on its USD Value

SolvBTC.BBN

staYSBBBN-SolvBTC.BBN

14X

slisBNB

staYLBNB2-slisBNB

2X

weETH

staYWEETH-weETH

4X of ether.fi points

1X Eigenlayer points

Scroll Marks based on its USD Value

💡