The Union
What is the Union?
The Llama Airforce Union is a service designed to streamline and enhance the yield-earning process on locked Convex tokens (vlCVX). Here's how it works:
When you lock your CVX tokens, the most logical approach for maximizing your rewards is to delegate your voting power to votium.eth. However, this can result in receiving up to 15 different types of reward tokens. Each of these tokens need to be claimed individually and, while they sit idle in your wallet, they aren't earning any additional yield. This can be not only time-consuming but also costly due to the gas fees involved when dealing with multiple transactions on the Ethereum network. Finally, when you're voting manually, there's a chance you could accidentally vote for the wrong pools or encounter technical issues with Snapshot. It's not always as smooth sailing as it sounds.
This is where the Union steps in. By joining the Union, you forward the collection of your Votium rewards to us. We then consolidate these diverse rewards and convert them into one or more auto-compounding tokens of your choice. This approach has several advantages:
Efficiency: We handle the conversion of your rewards, saving you time, effort, and expensive gas costs.
Auto-compounding: Your rewards are automatically invested into tokens that compound, leading to further yield over time.
Rollover: The rewards are delivered in the form of airdrops which roll over after every round. This means that your unclaimed rewards continue to earn yield, even when they are not yet claimed.
Custody: You retain custody of your CVX, managing your own locks. This means that there is no custody risk from the Union's perspective, and we don't control any of your CVX tokens.
No peg risk: as the Union is not a liquid wrapper, there is no temporary depeg risk to worry about.
Worry-free: By delegating to Votium and letting the Union handle your bribes, you can forget about missing out on rewards due to voting blunders or third-party technical glitches like those from Snapshot. Just kick back and let us do the work!
Therefore, by joining the Union, you can enjoy a simplified, efficient, and potentially more profitable yield-earning process on your locked CVX tokens.
Fees
At the time of writing (6 July 2023), the fees are the following:
Shared Gas Costs: The Union evenly divides its operating gas costs among users, reducing individual expenses.
2% Fee on Incoming Rewards: A 2% fee is deducted from your earned rewards, slightly reducing the final APR. For example, your final APR will be 29.4% if the bribe APR is 30%.
Yield Fee on Airdropped Pounder Shares: A variable fee is charged on the yield of the auto-compounding pounder shares you receive.
Claiming
After each reward round in the Union, we'll airdrop your earned rewards. It's up to you whether you want to claim them right away or not. If you decide not to claim, don't worry, your unclaimed rewards will roll over to the next round. This means your rewards will keep compounding, whether they're unclaimed in the contract or claimed and sitting in your wallet.
But keep in mind, claiming rewards might trigger a taxable event, depending on your local tax laws. So, it might be worth chatting with a tax advisor before you do. Leaving your rewards unclaimed in the contract could potentially help you avoid this.
Also, we've got zaps available for you to use if you prefer to withdraw or claim your rewards as a specific token. However, the gas costs for these actions can vary. This is because some zaps require multiple swaps through Curve pools, which could increase your costs.
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