Gains Network DAI (Arbitrum)

gDAI

gDAI is an ERC-20 token representing ownership of the underlying DAI asset staked in gTrade's DAI vault.

Risk Rating
Best
$1.00
-0.03%
Summary
What we like
gDAI allows holders to earn interest on their USD while also benefiting from trading fees generated by the protocol. Additionally, as traders on the platform incur losses, those losses are distributed to gDAI holders, which can result in additional value accrual over time.
What we like less
The withdrawal process for gDAI requires going through an exit queue that lasts between 1-3 epochs (each epoch is 72hrs) depending on the vault's collateralization level. This can be inconvenient for users who want to quickly access their funds.
What it means for you
Offers you a simple way to earn a high yield on USD stablecoins, albeit with the risk of your deposits being potentially undercollateralized.

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Information
Blockchain
  • Arbitrum
Key Metrics
  • ATH: $1.01 (05/12/2022)
  • ATL: $0.89 (03/11/2023)
Risk Assessment
Best
Asset Strength

gDAI is a low-cap, fully collateralized asset. This asset is exposed to the underlying risks of Gains Network and Arbitrum bridge, which are protocols rated as Watch out and Average, respectively.

Asset Tokenomics

gDAI has an uncapped supply but has inflation control or burn mechanisms in place.

Dependencies

Gains Network


Arbitrum Bridge

Things to know about gDAI

How the gDAI vault works

The gDAI Vault is an ERC-4626 compliant DAI vault where gDAI shares represent the underlying DAI asset. As the counterparty to all trades, the vault pays out winnings to traders and receives losses in exchange for a portion of trading fees that are split among gDAI shares to incentivize stakers to remain in the vault. Collateralization depends on trader PnL, and when overall PnL is negative, the vault creates a buffer to protect stakers' funds and the protocol from future abnormalities. The vault follows an epoch system for capturing snapshots of open PnL to better approximate the real collateralization ratio and minimize risks for the protocol and stakers.

How gDAI accrues value

gDAI is a token that represents ownership of the underlying DAI. It follows an exchange rate model that takes into account two variables: accumulated fees and trader PnL (both open and closed). The value of gDAI to DAI changes in real-time based on these variables. The accumulated fees represent how many fees a single gDAI has accrued over time, while trader PnL is a snapshotted value of the profit or loss from closed trades and a snapshot of open trades from the end of the previous epoch. The value of trader PnL can move in either direction, so the value of gDAI can fluctuate based on both accumulated fees and trader PnL.

How the epoch system works

The epoch system is a decentralized way of providing the gDAI vault with open PnL data to better understand its collateralization ratio. On-chain calculation of open PnL is too computationally expensive to do in real-time, so the system has two states: the withdraw window and the open PnL window. During the withdraw window, stakers may make withdraw-related actions, but open PnL values are not being received. In the open PnL window, the protocol requests open PnL snapshots from oracles, taking the median value from a network of oracles, and then averages it across the request periods. The stakers' DAI cannot be withdrawn immediately for the security of the vault, and depending on the collateralization ratio, a staker may need to wait 1 (ratio >120%), 2 (>110%), or 3 epochs after making a request before being able to withdraw.

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gDAI Pools
Pendle gDAI Principal Token (3/27/24)
0%
Yield
$252K
TVL
Risk
C
Protocol
Pendle
Chain
Arbitrum
Pendle gDAI Market Making (3/27/24)
6.2%
Yield
$252K
TVL
Risk
B
Protocol
Pendle
Chain
Arbitrum

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