Ruby.Exchange integrates gemstone NFTs throughout the platform's UX to increase stickiness and create a rewarding, feature-rich user experience. Gemstones will initially be used for two purposes:
Profile gems, to be displayed as user identifiers.
Reward gems, with three different functions: Trading fee rebates, LP reward boosts, and Reduced early-exit penalties on yield farming earnings.
Ruby.Exchange launched with profile gemstones and zero-fee gemstone NFTs.
Upon completing their first transaction on Ruby, users receive a profile gemstone, generated at random using a wide range of parameters including color, shape, edge brightness, roughness, wear, and other properties.
Addresses without a profile NFT will automatically receive one upon conducting their next transaction, so new gemstones can be minted simply by burning NFTs or sending them to another account. In the future, unwanted profile gemstones can be traded on Ruby's NFT marketplace.
Traders: Fee Rebates
The first category of reward gemstone reduces the commission fee (default 0.3%) that traders pay on every swap. There are no limits on the size of the swap to which these NFTs apply.
Initially, this will be implemented as a full rebate: Users who hold the gem will not pay any trading fees.
In the future, partial fee rebates will be implemented, with a series of gems that reduce traders' fees by varying amounts. The balance of the fee charged will be distributed in the same proportions as before (83% to LPs, 13% to RUBY stakers, and the rest burned).
For example, if the fee is reduced from 0.30% to 0.21%, LPs will receive 0.175%, stakers 0.028%, and 0.007% will be burned.
LPs: Reward Boost
Liquidity providers receive 0.25% of the total 0.3% trading fee by default. This is implemented at the time that liquidity is deposited to Ruby's AMM pools: A percentage of LP tokens is minted to the liquidity provider, with the remainder sent to the RubyMaker contract. The LP Rewards NFT increases the percentage allocated to the liquidity provider, meaning they receive a larger fee from every swap conducted on the platform. The remainder of the fee is distributed to stakers and burned in the same proportions as before.
Each LP Reward Boost gem can be used to lock a certain maximum amount of funds. The gem expires after it has been used, ensuring it cannot be used to increase rewards on unlimited liquidity.
LPs: Reduce Early Unlock Penalty
Rewards claimed by LPs are locked for a three-month vesting period. However, LPs can opt to receive their rewards immediately, at the cost of a 50% early exit fee. A third category of NFT reduces this penalty, giving LPs instant access to higher rates of rewards.
Because these three NFTs involve altering the allocation of swap fees, their use requires no additional RUBY rewards to enter the system. Like profile gems, reward gems can also be bought and sold on the NFT Marketplace.