Otter Pond vs. Otter Lake

  • How Otter Pond works
  • How Otter Lake works
  • Where to park your CLAMs and PEARLs

Otter Bites (TL;DR)

What is Otter Pond?

  • bonds that can be purchased on OtterClam, denominated in staked CLAMs; meaning that you will receive staking rewards after each rebase. These rewards are added to the vesting sCLAM tokens. You will not be able to withdraw them before the end of the vesting period.
  • PEARLs, which are wrapped sCLAM tokens. As such, PEARL holders get staking rewards as the index grows after each rebase. As a result, one PEARL will contain more and more CLAMs over time.

What is Otter Lake?

  • keep them as is, they will get staking rewards from Otter Pond
  • unwrap and keep the underlying sCLAM tokens
  • unwrap and withdraw the underlying CLAMs to sell them, also known as “capturing the benefits”
  • add them to your current PEARL Chests, which will reset the locked period
  • use them to create a new PEARL Chest
  • use them as collateral to borrow other assets (coming soon)

How Otter Lake and PEARL Chests benefit everyone

  • When PEARLs are locked, they aren’t accessible. This implies a lot less selling pressure on the CLAM token, and while it doesn’t guarantee price appreciation, it makes it easier for CLAM to increase in value.
  • If the PEARLs that are locked can’t be sold on the market, and if the price of CLAM goes up, it means that the value of the treasury will also go up. This directly increases the runway (the period during which the protocol can issue new rewards), which is always a good thing for the protocol — for all Otters as well.
  • We want to make sure that Otters who lock their PEARLs in Otter Lake can also participate in the growth of the protocol with the rewards they will collect at the end of each epoch, either by locking more tokens or purchasing more bonds.

Before playing in Otter Pond, remember:

  • You have full control over your investment. You can withdraw your sCLAMs and unwrap your PEARLs anytime you want.
  • Likewise, you can get your rewards from staking as soon as the rebase rewards are distributed.
  • If you choose not to get your rewards in the meantime, leaving them staked in the pond would enable you to auto-compound your sCLAMs.
  • For Otters selling their CLAMs to purchase new bonds (a.k.a. bond flippers), you will still be able to do that. Just remember, the ROI you will get over the 5-days vesting period may be lower than the potential reward you can get by locking your PEARLs in Otter Lake.
  • Otter Pond gives a lot of operational autonomy, but, conversely, offers less rewards than Otter Lake (see below) : you will collect only 20% of the rewards emitted by the Protocol. Otter than that (pun intended), your otter life will remain the same.

Before lounging at Otter Lake, remember:

  • You need to lock PEARLs for a given period of time.
  • Locked PEARLs cannot be manipulated while they are locked in a Chest for the entire locking period.
  • You get bonus rewards from Otter Lake- you also get regular staking rewards simply because you are holding PEARLs.
  • By staking with a Pearl Chest in Otter Lake, you will also receive a Pearl Note NFT. This is your key in unlocking your PEARLs after the time-lock and in being eligible for rewards. Instead, if you don’t want to wait, just like other NFTs, you may sell this, gift it to a loved one, or airdrop it to others if you are feeling generous.
  • You are exposed to the risk of locking your asset. There is no guarantee that the PEARLs you lock will still have the same value at the end of the locked period. This risk is the main reason behind the very high reward allocation from Otter Lake.
  • As a mitigation system, you may trade your PEARL Note as an exit solution.
  • PEARLs you get from Otter Lake do not auto-compound in quantity. This is because PEARLs are already technically auto-compounding as the index increases (i.e. PEARL Price = CLAM Price x Index). Nevertheless, you may still manually compound the number of your PEARLs by adding them to your Pearl Chest or opening another one.

Putting it all together

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