The game

First of all, to play the game you need to buy Derby (DRB) tokens (ERC20). There is a fixed amount of Derby tokens on the market. Each token can be locked into our Derby game contract and for each token locked the player will receive a vote. The Derby game player can allocate this vote to one of the whitelisted DeFi protocols within one of the Derby vaults. The vaults are cross-chain. This means that each vault is implemented on multiple chains and layers, but over these chains and layers it will act as just one vault for investors and game players. It’s good to note here that Derby Finance will offer a different set of vaults for DeFi investors with different risk characteristics and different currencies. A clear description of how the Derby vaults work is given in the article: Derby Finance, the vaults. The more tokens a player has locked in the game contract, the more votes it can allocate to the whitelisted apps. This basically leads to each player creating a custom portfolio of DeFi protocol allocations. If we sum up all of the allocations from all the different players by just adding up all the votes we create a complete and diversified portfolio consisting of a wide variety of different DeFi protocols.

This is the basic idea, but this will only work as long as all players behave somewhat rational. No full rational behavior is required here, irrational behavior will hurt the performance somewhat in some cases but it won’t lead to great losses because the whitelisting process will only allow DeFi applications with a solid track record to be part of the game. To set the incentives in a correct manner, a percentage (currently 10%, to be determined by the DAO eventually) of the performance of the underlying Derby vaults will be reserved for the game players as a reward for playing the game successfully. These reserved yields will be divided among the game players as a function of the amount of tokens locked and the underlying performance of the game players. So, if a game player has made a lot of profit with his or her portfolio it will receive a relatively large reward. Also if a game player has locked a lot of tokens it will receive a proportionally bigger share of the reserved rewards.