Wrapped Smart Tokens

Wrapped smart tokensare a specialised form of smart tokens designed to simplify user interactions and provide a stable representation of a user's share in the total deposit pool. By wrapping smart tokens, we create a fixed balance representation, where the ratio of a user's balance to the total supply represents their proportionate share of the underlying assets.

Customization for the Risk Protocol

Built on top of Buttonwood’s Unbutton contracts, these wrapped smart tokens have been customized specifically to meet the unique requirements of the Risk Protocol. This customization allows us to integrate the advanced features of smart tokens while providing users with a more accessible and user-friendly interface.

Benefits and Usage of Wrapped Smart Tokens

1. Simplified User Experience:

   • Fixed Balance Representation: Unlike smart tokens, which may experience balance fluctuations due to rebalancing, wrapped smart tokens maintain a fixed balance. This means users don’t need to worry about understanding or managing the complex mechanics of rebalancing, making it easier for them to hold and interact with the tokens.

   • Stable Proportional Ownership: The ratio of a user’s balance to the total supply of wrapped smart tokens directly represents their share of the total deposit pool. This proportional ownership model ensures that users can easily track their investment in the protocol without dealing with fluctuating balances.

2. Extended Utilities:

   • Access to Unwanted Token Flashloans: Users can participate in flashloans using unwanted tokens held by the wrapped smart token contracts, providing opportunities for arbitrage or other financial strategies with potentially lower risk. For more info, check the Flashloan section.

   • Enhanced Liquidity: Wrapped smart tokens can be more easily traded or used as collateral in DeFi applications as they represent a fixed proportion of the underlying assets. This makes them a versatile tool for users looking to leverage their holdings within the broader DeFi ecosystem.

   • Compatibility with Other Protocols: By wrapping smart tokens, we ensure compatibility with a variety of DeFi protocols and applications that may not natively support the rebalancing properties of the original smart tokens. This opens up additional avenues for users to utilize their tokens, such as in lending, borrowing, or yield farming.

3. Accessibility for Non-Technical Users:

   • Simplified Holding: Wrapped smart tokens abstract away the complexities of rebalancing, making it easier for non-technical users to hold and benefit from the underlying assets without needing to understand the intricacies of smart token mechanics.

   • Extended Use Cases: Users can engage with the protocol’s advanced features, such as flashloans or liquidity provision, without needing deep knowledge of how the rebalancing process works.