💡Context

TL/DR : Opal is a set and forget, gas efficient, diversified and user friendly access to sophisticated farming opportunities.

Although the project's operation is based on fundamental DeFi mechanisms and tools, Opal's design integrates the most recent iterations in the field of DeFi market making, and aims to address a current problem. In order to contextualize Opal's objective and value proposition, let's briefly recap the market in which the project operates and its inefficiencies:

The ancient murals tell the story of a crypto kingdom in great expansion, harvests were great and resources were flowing. Farming had become so attractive that all the inhabitants were turning to this activity, creating an imbalance in the distribution of the precious liquidity necessary to quench the inexhaustible thirst of the markets, drying up the flow of supplies.

Thus began the liquidity wars, as resources became increasingly scarce and the diversity of actors less and less perceptible, a handful of ecosystems began to establish their dominance over the distribution of resources.

It is worth noting that Uniswap, by cleverly retaining its first mover advantage and pioneering concentrated liquidity, was able to provide a fertile field for the development of a DeFi ecosystem that was as risky as it was permissionless. However, the tokenomic of the project exposes its development to conflicts of interest and offers less room for composability.

Curve Finance has taken a different direction by introducing the first vote escrowed tokenomic, further aligning holders and users with the project, using DAO-controlled incentives to optimize liquidity distribution. In order to obtain veCRV it is necessary to lock in CRV tokens for a period of 1 to 4 years, which will give access to a share of the protocol's revenues distributed in 3CRV, as well as voting power to direct CRV emissions as a reward to the liquidity providers of the protocol's pools. LPs are incentivized to hold veCRVs in order to obtain a boost in their APR.

Convex Finance is the first liquid wrapper built on top of veCRVs to reduce governance access constraints and to mutualize the veCRVs needed to obtain the APR boost, allowing all users to join together to increase their return. Thus, Curve's liquidity providers could stake their LP on Convex and CRV holders could participate in the governance of this new ecosystem with shorter lock periods.

By joining their forces Curve and Convex created the first sustainably valuable utility for governance tokens, carrying in their path the formation of Balancer/Aura ecosystem, and the development of vote incentives markets. Note that in the span of 2 years almost $300M of voting incentives were distributed to attract liquidity on those DEXs.

Opal follows the path of liquid lockers such as Convex or Aura by taking advantage of their yield opportunities, while perpetuating the desire to deepen liquidity and simplify access to on chain trading.

However, since Convex emissions are coming to an end and because the control over CRV emissions relies on CRV single sided locks, the compounding of interests to rebalance the increasing dilution of power doesn't empower veCRV holders to ensure accurate distribution of emissions according to underlying pools liquidity, which in turns reduce the correlation for bribers between dollars spent to capture emissions and actual increase in liquidity depth.

This is why Opal is initially designed for Balancer/Aura ecosystem, which benefits from the many advantages mentioned above, while also leveraging a stronger incentive structure and ensuring the need for Opal's liquidity. This will enhance the value of the liquidity distributed via Opal for $vlGEM holders and Omnipool LPs.

Alternatively to vlAura holders who are paid to direct rewards and attract liquidity providers, $vlGEM holders can be incentivized by projects willing to bootstrap their actual pools' liquidity in the same way that a launchpad would do, or receive incentives from larger institutions on ETH liquid staking Omnipools.