The Mute Amplifier system is a crucial component of the Mute zK platform. It incentivizes liquidity providers (LPs) to contribute to the platform, which in turn helps to ensure the stability of the ecosystem and its ability to handle increased transaction value. The rewards provided by the Amplifier are funded by platform revenue and fees, which come from the buy-back and make system that the Mute DAO has in place. This means that LPs who participate in the Amplifier program can expect to receive a steady flow of additional income in the form of APY. Paired with the Bond platform, this ensures a stable, healthy ecosystem.
The Amplifier program provides a specific amount of $MUTE over a set period of time with a target APY for LPs. To be approved for the Amplifier program, projects must meet certain criteria set by the Mute team and DAO. It’s important to note that not all liquidity pairs on the Switch will have amplifier pairs. Amplifier pairs are decided by the team and DAO and will only be available for important base liquidity pairs, such as ETH/USDC, WBTC/USDC, and others.
Each amplifier has a capped amount of buy-ins to ensure that the base APY is not diluted. The APY in an amplifier is variable and is determined by a ratio of the user’s snapshotted dMute (DAO Mute) vote value versus the total Mute rewards in the pool. To own dMute votes, you can either own dMute directly (by vesting or stacking) and have ownership over its delegation or have other dMute owners delegate their vote share to you. This allows for third-party LPs to bribe dMute owners for their votes. To own the Max Amplified APY, you must own the same amount of Mute rewards in the pool as you do of dMute votes.
For example, if you provide $50k worth of LP on an ETH/USDC pair with an amplifier that has a 5% base APY and a 15% max APY, and the pool has 80,000 MUTE allocated as rewards, and you own 40,000 dMute votes, your amplified APY would be 10%. In other words, to own the Max Amplified APY (15%), you must own the same amount of Mute rewards in the pool as you do of dMute (80,000 dMute) votes. Additionally, your dMute votes/holdings carry over to all amplifiers, so if you’re providing LP to two amplifiers, your dMute balance is not split among them. This is to encourage participation in the pools.
This system offers a unique solution to the problem of low liquidity in decentralized finance (DeFi) platforms. By offering additional revenue to LPs, it helps to attract and retain more liquidity in the platform, which leads to increased stability and reduced slippage for users. The system’s focus on Mute’s DAO governance further emphasizes the importance of community involvement in ensuring the success of the platform.
In conclusion, the Mute Amplifier is a key part of Mute’s zkPlatform, providing valuable benefits to both liquidity providers and the wider community. It offers a novel solution to the issue of low liquidity in zkDeFi, by incentivizing LPs and contributing to the stability of the ecosystem. With its unique design and community-driven governance, the Mute Amplifier is set to play a major role in the future of decentralized finance.
To participate in the Mute Amplifier program, follow this link: Mute Amplifier Registration. By taking part in the Mute Amplifier system, you can enjoy additional revenue and become a part of the Mute ecosystem.
