🤖Mechanism Overview

HOW IT WORKS

WEN Protocol combines LSD and Liquity, and supports a variety of LSD asset combinations based on the Liquity protocol.

Here is a brief introduction how Wen Protocol works:

1. Deposit - Users can deposit their pufETH into Wen protocol, they can either choose a strategy or approve their assets to a vault contract. The assets will go into different puffer protocol and start earning interests, and WEN protocol takes no fee.

2. Mint - Users can mint the native stablecoin wenUSD against their assets used as collateral by opening a Trove, where incentivized by esWEN.

3. Redeem - Redeem1 wenUSD for $1 worth of pufETH when wenUSD pegging falls below $1 at any time.

4. Liquidate - Secure Wen Protocol by providing wenUSD to the Stability Pool in exchange for rewards paid as liquidation fee and esWEN.

5. Earn - Providing liquidity for $WEN/ETH and wenUSD/USDC LP pool to earn reward paid in esWEN, CRV, CVX and transaction fees.

6. Stake - Stake esWEN to earn the protocol fees such as minting fee, redemption fee and annual fee, earn esWEN and govern the system.

7. Lock - Buy and Lock WEN from the market, convert it into esWEN to earn protocol incomes and governance the system.

8. Unlock - Unlock esWEN and convert it to WEN at anytime through a cliff-linear-vesting process.

9. Governance - Vote on WEN Improvement Proposals to decide the future of WEN protocol.