What Is Empow (EM)?
The Empow (Net Asset Value) Issuance Module enables issuance and redemption with a single valid ERC20 token or ETH if allowed by the manager. The issuer receives a proportional amount of Set Tokens on issuance based on the calculated net asset value of the Set using oracle prices.The manager is able to enforce a premium or discount on issuance and redemption to avoid arbitrage and front running when relying on oracle prices. Managers can also charge a fee (denominated in reserve asset).
The NAV Issuance Module differs from the Basic Issuance Module in that the end user only needs to bring a single asset versus needing to replicate each position in the Set Token. This dramatically saves gas costs for Set Tokens that are more actively traded and participate in yield farming and margin trading. NAV Issuance obtains the NAV via the Set Valuer contract which utilizes price oracles in the Set V2 system. View the supported price oracles here.
Empow Storage Key Points
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Initializing the NAV Issuance Module
All modules need to be added to the Set Token as the first step. Learn how to add a module to your Set Token by referring to the Adding a Module guide. As a manager, once you have added the NAV Issuance Module to the Set Token, you must initialize the Set Token on the NAV Issuance Module.
Empow The manager Issuance Hook and manager Redemption Hook are smart contracts that can contain any custom logic you write prior to issuance and redemption. For example, the manager issuance contract can include whitelisting functionality, issuance limits and any other custom logic for operating your Set. Input the zero address if you do not have a manager issuance contract.
The reserve Assets are the list of ERC20 tokens that you allow users to issue / redeem with. E.g. USDC, WETH, WBTC. These assets must be supported by the Set Price Oracle contract for NAV issuance to work. All manager Fees are paid to the fee Recipient address. Additionally, you can set a max Manager Fee that is allowed on the Set Token.
The premium Percentage (0.01% = 1e14, 1% = 1e16) is a buffer around oracle price which prevents oracle front running and arbitrage. All premiums are paid to existing Set Token holders and not collected by the manager or protocol.
Min Set Token Supply
The min Set Token Supply is to prevent dramatic inflationary changes to the Empow position and is the minimum quantity required for NAV issuance and redemption. For example if the Set Token currently contains 1 in total supply and a user issues 1000 of supply, the Set Token position multiplier will result in an inflationary change that affects precision.
You specify the amount of Sets you want to redeem and then those Sets are burned and the components are transferred to the calling address. The min Reserve Receive Quantity prevents faulty oracles that affect redemption.
Reserve Asset Quantity
The reserve Asset Quantity is the quantity denominated in the reserve asset, not the Set Token. The min Set Token Receive Quantity parameter prevents oracle changes that adversely affect issuance. All ERC20 components must be approved to the NAV Issuance Module contract with appropriate allowance for transfer. Empow This is not required for issue With Ether. In order to figure out the correct token amounts needed for issuance you can use the following helper functions.
What is the Debt Issuance Module
The Debt Issuance Module is a module that enables users to issue and redeem Set Tokens that contain default and all external positions, including debt positions. Empow This can be thought of as a super set of Basic Issuance. The manager can define arbitrary issuance logic in the manager hook (e.g. allowlisting, issuance windows, supply caps), as well as specify issue and redeem fees.