---
# System prepended metadata

title: Add a cvxCRV cauldron
tags: [Abracadabra, Convex, cvxCRV]

---

# Add a cvxCRV cauldron

###### tags: `Abracadabra` `Convex` `cvxCRV`

> Edit 24/11 : As C2tP pointed in the Convex Discord, a wrapper already exists for staked cvxCRV to allow rewards dripping to users [Link](https://github.com/convex-eth/platform/blob/main/contracts/contracts/wrappers/CvxCrvStakingWrapper.sol)

# Infos

- Cauldron : part of the Abracadabra system where an user can deposit an interest bearing asset ( ibAsset ) as collateral, and borrow MIMs against it. Each cauldron is segregated from the others, and has it's own parameters, including MCR.
- MCR ( Max Collateralization Ratio ) : Also called LTV ( Loan To Value ) or Collateralization Ratio, refers to the max value that can be borrowed against a specific asset.
- Liquidation fee : part of the collateral that is added to the liquidation amount to pay the liquidator.
- Borrow fee : upfront fee in MIMs when borrowing.


# Convex Finance
Convex Finance which is issuing the cvxCRV ( a liquid version of veCRV ), has seen tremendous growth since it's inception in may. It currently holds a TVL of 16 billions $ ( ranked 4th on [Defi Llama](https://defillama.com/) ), and earned 450 millions+ $ worth of tokens to it's users. 

[Convex's address on Curve](https://curve.fi/pools?see=0x989aeb4d175e16225e39e87d0d97a3360524ad80) 

Convex issues a **cvxCRV** token, which is a liquid version of CRVs *vote escrowed* on Curve. 

This allow Convex to distribute the Curve plaforms fees to it's users, and manage the voting power of the **veCRV** they locked.

More informations on how Convex Finance works in [their documentation](https://docs.convexfinance.com/convexfinance/general-information/why-convex).

More informations on the CRVs earned/held by Convex Finance on [@banteg](https://twitter.com/bantg)'s [Dune dashboard](https://dune.xyz/banteg/misc).


# cvxCRV

The **cvxCRV** is a 1:1 token representing veCRV locked by Convex, that can be staked to receive a share of the Curve plaform fees like veCRV normally does.

On top of that, staked cvxCRV receives a share of the CRV farmed by the Convex platform on behalf of it's users, a share of the CVX distribution ( Convex's native token ), and any airdrop done to veCRV holders.

Current cvxCRV yield at the time of writing :
![](https://i.imgur.com/5X7SXHH.png)

More informations on how cvxCRV works in [Convex's documentation](https://docs.convexfinance.com/convexfinance/general-information/understanding-cvxcrv).

# The proposal 

The proposal aims to open up an Abracadabra cauldron that could allow the borrowing/leveraging of cvxCRV. To do this, a wrapper would need to be created for wcvxCRV that upon unwrapping would allow the user to recieve their share of rewards. 

When the user uses leverage, Abracadabra can optimize the leverage by choosing the best route to swap for cvxCRV.

- If the cvxCRV/CRV ratio is below 1, buy the cvxCRV on the market.

![](https://i.imgur.com/uTEMrkt.png)

- If it's not, buy CRVs and lock them directly on Convex at a 1:1 ratio.

The parameters would be : 

- Max LTV : 85%
- Borrow fee : 0.5%
- Interest : 0.5% 
- Liquidation fee : 12.5%

And the yield would be as followed : 

- 3CRV from the Curve platform fees ( DAI/USDC/USDT LP tokens ).
- CRV from the Convex platform fees.
- CVX from the Convex token distribution.
- EPS airdrops on the Binance Smart Chain.
- Possible other future airdrops.

# Benefits for each platform 

## Abracadabra

- Increase the global MIM supply.
- Allow users to borrow/leverage another collateral.
- Generate fees from interests, borrow fees and liquidations.
- ( Build a vlCVX treasury from a cut on the rewards, see below )

## Convex 

- Increase the cvxCRV staked on the platform.
- Increase the voting power if Abracadabra locks new CRVs on the platform.
- ( Increase the amount of locked CVX, see below )
## Curve

- Increase the overall amount of CRV locked.
- Generate more volume on the cvxCRV/CRV pool.
- ( Generate more fees on the MIM-3Crv pool, see below ).

# Possible modifications 

- Abracadabra could take a cut on the CVX farmed by the cauldron to lock them and gain voting power for MIM pools as treasury ( see [this proposal](https://hackmd.io/@Clonescody/ByksCm1BK) for details ).
- Abracadabra could implement a daily/weekly swap of the 3Crv on Curve to repay the user's MIM debt automatically hence refilling the cauldron on a periodic schedule.

# Resources

## Token addresses 

- CRV : [0xD533a949740bb3306d119CC777fa900bA034cd52](https://etherscan.io/token/0xD533a949740bb3306d119CC777fa900bA034cd52)
- CVX : [0x4e3fbd56cd56c3e72c1403e103b45db9da5b9d2b](https://etherscan.io/token/0x4e3fbd56cd56c3e72c1403e103b45db9da5b9d2b)
- 3Crv LP : [0x6c3F90f043a72FA612cbac8115EE7e52BDe6E490](https://etherscan.io/token/0x6c3F90f043a72FA612cbac8115EE7e52BDe6E490)
- cvxCRV : [0x62b9c7356a2dc64a1969e19c23e4f579f9810aa7](https://etherscan.io/token/0x62b9c7356a2dc64a1969e19c23e4f579f9810aa7)
- EPS Token on BSC : [0xa7f552078dcc247c2684336020c03648500c6d9f](https://bscscan.com/token/0xa7f552078dcc247c2684336020c03648500c6d9f)

## Contracts 

- cvxCRV staking contract : [0x3Fe65692bfCD0e6CF84cB1E7d24108E434A7587e](https://etherscan.io/address/0x3Fe65692bfCD0e6CF84cB1E7d24108E434A7587e)
- Staked cvxCRV wrapper : [Convex repository](https://github.com/convex-eth/platform/blob/main/contracts/contracts/wrappers/CvxCrvStakingWrapper.sol)
- EPS claiming contract on BSC : [0x6e4fa069a6aabd2529838debed2435e9eacc1a00](https://bscscan.com/address/0x6e4fa069a6aabd2529838debed2435e9eacc1a00)
