UMAMI Staking

tags: UMAMI Finance cmUMAMI mUMAMI

tl:dr

• Stake as mUMAMI for wETH payouts
• Deposit mUMAMI as cmUMAMI in the compounder to automatically swap wETH rewards for more UMAMI
• Moving between mUMAMI and cmUMAMI isn't limited
• Unstaking mUMAMI can only happen the first 2 days of each month
• Unstaking cmUMAMI to UMAMI can be done via an Uniswap pool at a discounted rate

Context

With the recent opening of a cmUMAMI:UMAMI Uniswap v3 LP(Discord link), this post aims to clarify how UMAMI staking works and to explain and what are the pros and cons of each mecanism for the stakers.

Resources

• UMAMI website
• UMAMI DAO documentation
• UMAMI DAO Discord
• UMAMI DAO Twitter

Staking

UMAMI is the governance and revenue sharing token of the UMAMI Finance platform.

UMAMI is a regular ERC20 token living on the Arbitrum network, which address can be found here : https://arbiscan.io/token/0x1622bF67e6e5747b81866fE0b85178a93C7F86e3

mUMAMI

The UMAMI token can be staked, you then recieve mUMAMI 1:1 as a representation of your staked UMAMI amount.

Once you have mUMAMI, you will be able to claim wETH rewards around every couple of days.

Those wETH are generated via :

• The yield generated by the treasury funds (mostly GLP)
• An entry and performance fee taken on vaults revenues

Note: at the time of writing, the USDC vault v1 has been paused so the yield comes only from the treasury while the v2 is being developed.

Staking UMAMI as mUMAMI results in a time lock, mUMAMI can only be unstaked back to UMAMI during the first 48 hours of each month. Follow UMAMI's Twitter page or Discord server to receive updates when unstaking is available.

mUMAMI Address : https://arbiscan.io/token/0x2AdAbD6E8Ce3e82f52d9998a7f64a90d294A92A4

UMAMI religiously publishes updates about the treasury funds and yield distribution on Discord and on their Medium page.

cmUMAMI

The auto compounder

cmUMAMI is another mechanism that allows users to automatically buy UMAMI with their wETH rewards from mUMAMI whenever those rewards are paid out.

You would deposit your mUMAMI in the contract, and receive cmUMAMI in exchange, those cmUMAMI now become worth more and more UMAMI instead of giving you wETH.

You can unstake from cmUMAMI to mUMAMI whenever you want without any fee, and if you stayed long enough for your position to compound at least one rewards distribution, you'll unstake more UMAMI than you put in.

As cmUMAMI becomes worth more and more mUMAMI, the exchange rate is not 1:1 like it is with mUMAMI:UMAMI.

cmUMAMI Address : https://arbiscan.io/token/0x1922C36F3bc762Ca300b4a46bB2102F84B1684aB

Visit this website to see the historical growth of the UMAMI:cmUMAMI ratio.

Note: At the time of writing, the ratio is 1.074 mUMAMI per cmUMAMI

The Uniswap pool

On September 14th 2022, UMAMI Finance announced in their Discord the opening of an UMAMI:cmUMAMI Uniswap v3 liquidity pool.

The introduction of this pool has added a bit of confusion regarding the exchange rates of cmUMAMI.

This pool has been opened to offer to users the ability to unstake without waiting the begining of the month by selling cmUMAMI against UMAMI in the pool at a discount.

This discount means that in order to unstake earlier than the regular scheduled time, users must pay a fee for doing so.

This discount also means that the UMAMI:cmUMAMI exchange rate of the pool is lower than the one given by the smart contract.

If you want to LP cmUMAMI:UMAMI, you can do so on this page.

Being an LP in that pool means that you will get yield only on half of your position as only half of it will be cmUMAMI and the rest will be UMAMI. If you expect the fees generated by the pool from people "unstaking" to be more than the staking rewards, being an LP is a good option.

You can also use the LP to accumulate cmUMAMI at a cheaper price by providing UMAMI liquidity in the pool for people to unstake earlier via the pool. Those people will sell you cheaper cmUMAMI for your UMAMIs.

Conclusion

Whatever your risk profile is, UMAMI staking allows you to chose what suits you best.

• If you prefer ETH payouts you can stake as mUMAMI and receive wETH.
• If you prefer to grow your UMAMI exposure, cmUMAMI will automatically increase your share.
• If you believe the Uniswap pool will generate more fees and want to slowly accumulate cheap cmUMAMI, the Uniswap v3 LP can be for you.

If you encounter any difficuly, need more informations, want to follow updates or just want to be part of the UMAMI family, you can join us on Discord, moderators and team members will be happy to chat !

Clonescody