Convergence Finance’s 1st Success of Private-Sale Tokens — More to Come in 2022!
We are proud to announce a successful private sale token use case to the DeFi world! ƒLITH is the first private-sale token Convergence Team offered since the Convergence Finance protocol launch in late February. Convergence’s future token is the first use case in the DeFi world to wrap private-sale token in the form of future token (ƒToken) with a lockup period in a decentralized way through smart contracts.
Timelock is applied to the smart contract to only allow redemption at some point in the future depending on the projects’ timeline. For example, LITH is listed as a private-sale token ƒLITH, the token redemption is only activated 6 months after for users to redeem LITH with their ƒLITH.
During the 6-month lockup period, ƒLITH was traded on ConvX and provided as liquidity via ConvPool to yield additional $CONV rewards. Apart from enabling non-whitelisted users to access ƒLITH initially when the ƒLITH-CONV pool was launched, this also allowed price discovery for the Lithium Finance project and feedback gathering from the Convergers community for the protocol.
Price discovery and redemption mechanism
The ƒToken with a lockup ideally should be trading at a discounted price on our AMM by the time its approaches to the redemption the price will converge to the spot price. ƒLITH has been a great success since the ConvO pre-IDO price at $0.0045, at the moment $LITH is trading at $0.0143 (3.2x pre-IDO price) and traded at $0.0705 (15.7x) during its all-time high.
Convergers started to redeem their ƒLITH tokens to $LITH at a 1:1 ratio after the 6-month lockup since the Convergence x Lithium pre-IDO. Lithium Finance has a strong investor network from Pantera, Alameda Research and Hashed etc. and $LITH is currently listed on prominent CEXs like Huobi, KuCoin and OKEx.
Our token redemption is not only limited to the Ethereum network, the bridging of underlying token redemption onto other chains like Solana, Polygon and Polkadot etc. will be facilitated. Our next token redemption will be ƒLIKE from Ethereum to $LIKE on Solana Network.
When users want to redeem their token on another chain e.g. Solana using their future tokens, they will lock their future token into our bridging smart contract with their destination address on the target chain specified on-chain during the token subscription. A relayer will be notified of the user’s redemption events and sign the deposit proof and become accessible on our API, the user can then use this proof on the target chain and receive the underlying tokens on Solana.
Onward and upward!
While we are on the cross-chain topic, Convergence Team has also ventured into Moonriver Network with the launch of Moonlit Finance in Q4. Moonlit is a standalone explorative AMM platform right now due to Moonbeam’s initial deployment on Moonriver Network. The Convergence Team is working towards a cross-chain compatibility solution with the vision of enabling Convergers to move the assets seamlessly from Ethereum to transact on Moonbeam’s high transaction throughput and low gas fee network with the cross-chain bridge in Q1 2022.
Democratizing investment by making private assets public has been the goal for the protocol since the beginning. The team has been reaching out to new and quality projects to align with our vision. We truly believe asset origination is the key success to the protocol, it takes time and effort and it will get there. Meanwhile, Convergence Team is working to bring other quality offerings like Lithium, Only1 and exclusive private sale of prominent protocol tokens like Polygon — making private markets public.
ConvDAO will also be introduced in Q1 2022 so that Convergence protocol will be governed and managed by a decentralized community of CONV token holders to propose, vote, and implement changes, including amending system parameters, suggesting and accepting new assets on ConvO, or adding completely new functionality to the Convergence Protocol. We will share a detailed product roadmap for Q1 2022 soon, followed by an AMA with the founding team.
Exciting times are coming, happy new year and see you in 2022!