Viva la Innovation in DeFi!
Despite the bleeding market these days, we haven’t stopped preparing our vision of helping DeFi with building deep liquidity via seigniorage “algocoins” for DEXes and wanted to reveal the future of Polaris Finance, more precisely the future of DeFi on Aurora with Polaris Finance.
Obstacles & Issues
It’s been 2 and half months since our launch on Aurora. We have faced many obstacles, and before we get to the main reason why our concept is different and why it shouldn’t be overlooked, let’s take a look at what tests we have passed.
Challenge #1: You are just another pump & dump fork!
Our Response: It’s been 2.5 months and our TLV has increased from $150K to $16M and settled at $12M. We have a truly passionate community and partnerships. That without them this would not have been possible!
Challenge #2: How will we handle extreme fear in the market?
Our Response: Polaris pegged assets are above the peg. “Sunrise” is minting, investors are being rewarded every epoch (6-hours or 4 times a day). Emissions are carefully handled, governance voting is active, protocol’s DAO is healthy… Everything is running smoothly. Solved.
Challenge #3: Once your assets are under peg, the protocol will die! Once the “Shares token” loses its utility, the liquidity will vanish!
Our Response: We revealed our “One to rule them all’’ concept, with multiple pegged assets, under peg has always been recovered, and to be honest, we haven’t seen an “under peg” situation for a while because of high demand and educated investors.
Challenge #4: Algorithmic stablecoins don’t solve anything in Defi and are useless.
Our Response: Wrong. Let us introduce to you our concept “Smart Routing via Pegged Assets”. Welcome to the Defi, where investors are properly rewarded for participating in decentralization.
Ok, I’m listening, hit me…what is Smart Routing via Pegged Assets really?
We’ve brought the multipegged ecosystem to bring huge liquidity to DEX to help the decentralization on Aurora, to make swapping possible without huge price impact and, of course, to help the DeFi investors to finally get what they deserve, to get properly rewarded for providing liquidity. People are the most important part of decentralization. Thanks to people, decentralization can work, so let’s move to the principle itself.
At this very moment, we have 3 pegged assets. POLAR pegged to NEAR (NEAR’s native), LUNAR to LUNA (cross-chain TERRA native) and TRIPOLAR pegged to xTRI (reflection token of staked Trisolaris’s governance token TRI)On 14 of May we will add our 4 pegged assets called ETHERNAL pegged to the price of 1 ETHEREUM. (you know what Ethereum is, don’t you :)
History for those battle — tested “seigniorage token experts”, expansion and inflation are controlled by our one and only Shares governance token called SPOLAR. If demand is too high => peg is too high. SPOLAR prints new pegged assets to put pressure on inflation to keep the price near the price of the assets we are pegging to. Through governance voting, we propose decisions that either increase or decrease emissions all designed to do one thing; keep the peg as close to 1:1. If demand is way too high, the price of pegged assets could even double, so we have to increase emissions slowly to put more selling pressure by minting more of the pegged asset to move towards peg (but slowly, no need for panic selling!).
Multi-pegged Seigniorage
Let’s get to the purpose of multipeg. When we build enough liquidity in pools, we can create a smart routing between pegged assets to route. Polaris’s two main pegged pools are POLAR / NEAR and LUNA / LUNAR have liquidity > than $2M. Even now, you can swap in those pools for more than $10K with a price impact of less than 1%. => low slippage.
With more liquidity, slippage — of course — gets even better. Now imagine you want to swap your LUNA for NEAR, or a stable token, or even Ethereum, it doesn’t matter. But there is a problem, there is not enough liquidity in DEXes pools, this results in a => huge price impact, due to high slippage.
Now, imagine we have a routing pool with enough liquidity that allows people to swap their LUNA for Ethereum.
Example: Today we have LUNA/LUNAR LP, POLAR/NEAR LP — Participants are being rewarded in SPOLAR with solid APRs, and Impermanent Loss (IL) is minimal.
- Now we want to swap LUNA for ETHEREUM, but we are not able to do that, because of a missing piece in the puzzle. The route today is LUNA ↠ wNEAR ↠ ETHEREUM
Trisolaris Smart Routing (atLUNA:wNEAR LP only has ~$200K)
Now if you want to swap 100 atLUNA you get huge price impact 👇
This is the part where our initiative comes with the LUNAR/POLAR pool => to connect to other pools with smart routing by Trisolaris.
- Users will be able to swap LUNA via a new route, LUNA ↠ LUNAR ↠ POLAR ↠ wNEAR ↠ ETHEREUM.
How was this done, was very simple…we established a new pool with POLAR:LUNAR. Voilà problem solved.
As the main token on Trisolaris is wNEAR, we don’t need to create tons of pools. We just need to fill in one missing piece of the puzzle. As we are expanding, we are going to bring strong coins from all the other blockchains to create more new LPs with pegged algorithmic assets to help Trisolaris minimize IL risks to motivate and properly reward holders and create new routes.
Our Strategic Move
Let’s grab one simple example and expound on it. Let’s assume we will bring tokens like the following AVAX, BTC, SOL, ATOM etc…All assets will get their pegged token, i.e. pAVAX, pBTC, pSOL, pATOM etc. The Protocol will create Liquidity Pools for investors and reward them with SPOLAR that controls expansion and inflation of pegged assets.
The Protocol will work with our partner Trisolaris to establish these routes from pegged assets to connect each and every native token with routes. Most of the liquidity in pegged pools is held by DAO, but investors can participate as well, with a slightly higher APR than in regular LPs. Missing pieces have been settled.
Routing pools will then look like this:
- pSOL/ETHERNAL -> to create routes for SOLANA to be easily tradable in DEX.
- pATOM/LUNAR -> to create route for ATOM
- pAVAX/pATOM -> to create route for AVAX etc…etc…
- 1 route is always enough…
Investors are properly rewarded with deflationary SPOLAR. Pools are being built with huge liquidity.
Decentralization won!
Are you going to miss it or are you going to participate in “holding with benefits” with One to Rule Them All? The dice have been thrown, the decision is up to you.
Much 💜
Polaris Finance
