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Ferrum’s Revolutionary DeFi 2.0 Product Crucible Brings Sustainable Rewards to the Masses

Ferrum has released its highly anticipated DeFi 2.0 product, Crucible… and it was well worth the wait!

Ferrum’s Revolutionary DeFi 2.0 Product Crucible Brings Sustainable Rewards to the Masses

Identifying the Problem

In order to truly comprehend the magnitude of a product such as Crucible, one must understand the problems that Ferrum set out to solve when building it! A large portion of DeFi 1.0 protocols fail to find success due to a lack of one very important attribute… Sustainability.

Unsustainable Rewards Models

Staking is one of the most commonly used protocols in the DeFi landscape. Investors are incentivized to stake a single asset and earn rewards in that same asset. The problem is that in order to incentivize participation, projects often resort to inflationary rewards mechanisms that add an immense amount of sell pressure to the token being rewarded.

Depreciating Assets

The problem with tokens who’s the main purpose is to be used as a rewards token, is that their value suffers as a result of all of the selling pressure. So while APRs may be high in the beginning, they quickly dry up as more people enter the pool causing more tokens to be pumped into the circulating supply and ultimately sold.

How Does Ferrum Solve This?

Most problems are solved out of necessity. Ferrum has been one of the go-to Staking as a Service providers since 2018. While these products are alive and well, Ferrum wanted to create a solution that not only curbed token emissions but was in fact deflationary. The underlying technology of Crucible — Plasma Staking — is a proprietary set of smart contracts that does just this!

Understanding Reflection Tokens

Ferrum’s native tokens are $FRM and $FRMx. Through the Crucible dashboard, users are able to mint a wrapped version of the tokens called cFRM and cFRMx. These wrapped versions are considered reflection tokens. Reflection tokens are unique in the sense that they have transaction fees associated with them. This means that anytime someone buys, sells, or transfers the token, a small (typically between 1–4%) is taken out, similar to a tax.

Arriving at a Sustainable Rewards Model

Now we know what we’re thinking… Tax? Nobody likes taxes! However, it’s important to understand what ends up happening with these transaction fees. In the case of Crucible, Ferrum gives its holders the ability to stake cFRM and/or cFRMx. Those staking cFRM or cFRMx share 100% of all of the transaction fees generated proportional to their stake in the pool. Stakers can come in and out of the pools as they please but remember, even transfers incur a fee that will be distributed to those who remain in the pools. This incentivizes long-term holding!

Appreciating Assets

If asked, most people who have a basic understanding of economics would opt to be rewarded in a deflationary asset as opposed to an inflationary one. Rewarding loyal token holders in a sustainable fashion wasn’t quite enough for Ferrum. Ferrum wanted to ensure that the asset being used to reward stakers and liquidity providers was also deflationary!

Creating a Perpetual Rewards Feedback Loop

Since the amount of rewards generated for Crucible participants is directly correlated to trading volume, the most important component to making Crucible successful is trading volume. Fortunately, Ferrum has thought of a unique way to ensure that trading volume remains consistent.

Make Sustainable Rewards — Crucible’s Perpetual Feedback Loop

Access Crucible Beta

If you wish to read more on Crucible, watch our highly informative videos, listen to the Crypto at the Ferrum Roundtable podcast, and sign up to join Crucible Beta, click here. Please remember we’ll be selecting a limited number of beta testers. You don’t want to miss the opportunity to be one of the first few people to test out this most advanced and revolutionary DeFi 2.0 product yet.

In Conclusion

What Ferrum has created with Crucible is remarkable. A truly self-sustaining economy with a perpetual rewards feedback loop is something that the DeFi landscape is in desperate need of. Ferrum will look next to bring this technology to other projects in the space as they continue with their mission toward breaking down barriers to mass adoption of blockchain technology. To find out how is Crucible going to revolutionize DeFi 2.0 watch the video below:

About Ferrum

Ferrum is a pioneer in ushering in the era of Interoperability 2.0. Powered by the Quantum Portal, Ferrum Network’s mainnet nodes and related infrastructure will bring value, data, and functional interoperability to every chain in the industry. Utilizing the Ferrum Network, anyone can build and deploy solutions on one network and instantly enable multi-chain functionality without the burden or technical debt that comes with managing a multi-chain infrastructure for their dApps, and projects.

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Nick Odio

Seeks Truth. Hacks Biology. Shreds Powder. Watches Markets. Reads Books.