I think @PeapodsFinance can become DeFi’s next multi-*billion* dollar protocol.

In this thread:
- Peapods’ new ‘volatility farming’ primitive
- How v2 update unlocks yield for single-sided assets
- $PEAS deflationary tokenomics
- SocialFi 2.0 features
- Security (eg audits)

1/

Crypto’s only certainty is volatility. There's a LOT of it.

Peapods brilliantly creates value from this volatility and captures the majority of it for ‘pod’ participants (both single-sided depositors and liquidity providers) and $PEAS holders.

2/

'Pods' are the units.

Each pod features a different volatile asset; I’ll use $wBTC as an example.

For a small fee (eg 1% for the wBTC pod) holders can ‘wrap’ their wBTC to the pod token, $pwBTC. Or pwBTC can be purchased directly. There is also an unwrap fee (eg 1% here).

3/

Each pod also features a less volatile asset that liquidity providers (LPs) can pair in 50/50 value proportion with the main asset.

At launch, pod creators can choose either $DAI or $pOHM (from an OHM pod) as the paired asset.

For the wBTC pod, DAI will be the LP asset.

4/

The wrap and unwrap fees are key to Peapods' new volatility farming primitive.

Specifically, when $BTC price rises >1%, then arbitrage users or bots will buy pwBTC, pay the unwrap fee, and sell it for a small profit.

The unwrap fee payment = volatility value capture.

5/

Likewise, when BTC price falls by >1%, then arbitrage users/ bots will buy wBTC, wrap (with a 1% fee) the wBTC to pwBTC, and swap the pwBTC for DAI.

Effectively, volatility in either direction leads to fee value capture for a given pod.

6/

Now, why would a normal user consider paying the wrap fee to join a pod?

Because they are then able to 'farm' the volatility-related fee capture for that pod, for potentially very high 'real' (i.e. no new token emissions) yield.

7/

And this leads us to one of the new innovations for Peapods’ Green Arrow (v2) update:

A proportion of the wrap/unwrap fees (which are collected as the pTKN) will be 'burned.'

Thus, the amount of TKNs represented by each pTKN constantly increases.

8/

Another proportion of the wrap/unwrap fees are used to market buy $PEAS, which is then distributed proportionally to the LPs for that pod.

Some LPers will either hold their PEAS or put them to work in the pPEAS pod, resulting in constant net buy pressure.

9/

Under this system, single-asset pTKN holders get to enjoy some of the volatility farming revenue.

LPs still benefit from this arrangement due to the pTKN wrap and unwrap fees paid by a potentially large number of single-sided depositors.

10/

But the tokenomics get even better. Because another proportion (between 5-10% per pod) of the fees are used to market buy $PEAS and *burn* them forever.

Thus, PEAS is a deflationary asset with consistent buy pressure.

11/

And EVERY. SINGLE. POD. (of any asset with volatility; so pretty much all crypto) will lead to $PEAS buy pressure and deflation.

I have reasons to believe that there will be hundreds or even _thousands_ of successful pods.

Hence my rosy feelings about $PEAS FDV & price.

12/

Another smart feature of the Green Arrow update is that pod creators will be able to set:

- Wrap & unwrap fee %s.

- The balance of pTKN burn vs. PEAS buyback rate for distribution to LPs (who also benefit from pTKN burns)

- a pod creator fee of between 0-5% of pod fees

13/

This introduces both game theory into the pod creation process and a SocialFi 2.0 element whereby pod creators are naturally incentivized to market their pods (and thereby Peapods!).

The organic marketing ethos extends to the pod community, who benefit from pod expansion.

14/

This tweet by @MStiive really nails it on the organic marketing x game theory aspects that could lead to accelerated growth: https://x.com/MStiive/status/1745585980852359296

15/

You can see examples of this in my own BizDev x marketing pod creation efforts.

I'm setting up and seeding liquidity for 4 different launch pods.

Yes I want my $PEAS investment to do well & I want to earn more $PEAS, but I will also earn creator fees from 3 of these pods.

16/

First, an $APE pod.

To help market this pod I purchased an awesome Ape, hired a great artist to make this image, bought an MAYC to raffle to those who join the pod, and with more on the way. https://x.com/0x7d54/status/1748063513526874186

17/

I'll also be launching an $STFX pod.

STFX and Peapods both have SocialFi 2.0 elements so they go well together.

And another community member had the brilliant idea to open a $PEAS spot vault on STFX, which is the largest trade ever on the platform: https://x.com/0x7d54/status/1747815371174764863?s=20

18/

And I already mentioned the $wBTC pod. This one will have some different settings than the other two, including a lower pod creator fee: https://x.com/0x7d54/status/1747350230348009545

19/

Finally, I'm seeding a $yETH pod (st-yETH, to be exact).

The pod fees will go to @yearnfi (not me) but as a big supporter of their ecosystem this is indirectly good for me (in addition to LPing for volatility farming yield in this pod!). https://x.com/0x7d54/status/1747645265748566220

20/

Ultimately I see at least hundreds of pods emerging to farm natural crypto volatility - it just makes too much sense.

And with the nice Green Arrow design feature bringing real yield to single-sided deposits, a lot of capital (and fees, and $PEAS burn) will accrue.

21/

The single-sided real yield feature of these pods also presents an opportunity to other DeFi projects.

They can eliminate their own single-sided staking with dilutive token emissions (there are hundreds of such projects, including @STFX_IO and @apecoin, that do this).

22/

Rather, they can simply open a pod, supply good liquidity, and then let their token holders join the single stake (or also LP, if they wish).

The project will earn $PEAS yield, trading volumes will increase (increasing revenue on traditional POL), etc.

23/

Other projects with tokens, DAOs, funds, and more will also benefit from setting up pods with their own tokens or those held in their treasuries. Peapods really is a new revenue vertical for both DeFi users and other protocols.

24/

I'm clearly very excited about Peapods and $PEAS.

But as with any new project and especially one rolling out a new DeFi primitive like this, smart contract exploits are of course a risk.

25/

For the Green Arrow update, Peapods completed audits with top firms, including @yearnfi's @yAuditDAO, they had further review by a yearn security expert, a bug bounty program, & more. https://x.com/PeapodsFinance/status/1747861627129770121

I personally am comfortable with the risk to deposit my funds.

26/

Peapods' volatility farming primitive and the $PEAS deflationary tokenomics model has effectively been demonstrated with _one_ pod.

But now with the Green Arrow update, imagine those sorts of dynamics with hundreds of high-liquidity pods... all burning $PEAS.

27/

And then, Peapods will quickly deploy to L2s (see above tweet), leading to the creation of popular pods for hundreds of more volatile crypto assets across the ecosystem.

With every single pod, and every single volatility cycle, resulting in $PEAS buy pressure & burning.

28/

The Green Arrow update also features other big developments that will be detailed elsewhere. And you'll hear about synergy with a well-established protocol that will help power growth.

But even just considering core functionality, I am extremely excited + bullish $PEAS.

29/end