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LIEN Token — Initial FairSwap Listing

tl;dr:

The Lien token ($LIEN) will be listed on Lien FairSwap, a uniswap-inspired trading protocol. Trading pair is LIEN/iDOL.

What is Lien in a nutshell?

Lien is composed of the following elements:

  1. Lien Protocol: A governance-less protocol for creating stablecoin ($iDOL) and options ($LBT) from ETH.
  2. FairSwap: Uniswap🦄 + Front running prevention with frequent batch auction ✋+ Dynamic Fee Pricing based on Volatility📊 = Lien FairSwap
  3. Lien token (LIEN): a utility token that rewards the token holders with a rebate on the Lien protocol and FairSwap usage fees

The Lien protocol charges a fee when users mint the iDOL stable coin (0.2%) and when they exchange assets using FairSwap (0.3% — variable). Fees are collected in ETH or iDOL and are then distributed proportionally to holders of the Lien token as discounts/rebates every 28 days. 100% of Lien Protocol fees and 20% of FairSwap fees collected are attributed to Lien Token holders (80% of FairSwap fees goes to the liquidity providers).

Please see this article for more details.

What you need to know about the LIEN token — Initial FairSwap Listing

Key information

When: September 7, 2020 (Changed to: September 13, 2020), Time: Aiming for 13:00 UTC but there could be delays. It will not happen before 13:00 UTC

Where: Lien FairSwap

Trading pair: LIEN/iDOL

Initial liquidity: 20,000 LIEN / 1,000,000 iDOL (the initial liquidity that we provide to the pool may be adjusted in the future based on ongoing assessment of the liquidity situation)

Initial price: Approximately 50 USD

What to do before the listing: If you are interested in obtaining the LIEN token, you will first need to acquire the stablecoin, iDOL.

You can obtain iDOL using the Lien app by minting them from ETH, or by trading them for ETH on FairSwap.

Warning: We expect liquidity to be low during the initial period post-launch of the Lien app on mainnet.

Users should be careful of miss-pricing in LBT and ETH/iDOL. If you would like to avoid miss-pricing when obtaining iDOL, try out the “Manual Tranche” functionality available on the “Trade” screen of the app.

Background information on starting price

As previously disclosed in our Token Metrics article, 10% of the total LIEN token supply was sold at approximately 50 USD per token to early contributors in order to provide initial liquidity on FairSwap.

For the Lien protocol to function as intended and provide users with a smooth trading experience from day one, securing liquidity was essential. The presale was conducted to achieve that objective.

The presale tokens and the tokens that we airdropped to contributors are not subject to lock-up.

We believe it would not be appropriate for the early contributors to take on additional risk by subjecting their tokens to lockup, when they are already taking on risk by contributing their efforts to a faceless team.

On August 23, 2020, some of the tokens that were airdropped to early contributors found their way onto Uniswap, and naturally, created a market before we could release FairSwap.

We would like to clarify that this pre-launch listing on Uniswap was NOT a deliberate action by the Lien team, and even though this was expected to a certain extent, we were nonetheless taken by surprise.

But we quickly realized that this was the power of permissionless networks.

Uniswap is a permissionless trading market (so is FairSwap!) and being able to freely create a market for any digital asset is truly powerful and inline with the ethos of decentralized finance.

Some unintended consequences of the listing of the LIEN token on Uniswap was that we had no choice but to face the reality of the market’s reaction to the LIEN token.

As of the time this article was written (August 31, 2020), the total liquidity for the LIEN-ETH pair on Uniswap was $82,898 and the trading volume for the last 24 hours was $193,364.

When we look at the trend, the price of LIEN appears to be trending upward, being priced at $310.71, when the above screenshot was taken.

Because the liquidity and trading volume are thin, one cannot derive any meaningful conclusions from this data and we have no intention of doing so.

It was, however, interesting for us to see the overall positive reaction from the market and the general interest that people have shown towards our project through our social channels.

Our intention from the beginning was to keep the listing price of the LIEN token on FairSwap the same as the presale.

We understand that the market data from Uniswap seems to be signaling a higher fair value for the token.

However, we decided to stick with our original plans and start the LIEN token FairSwap listing at approximately 50 USD.

What to expect when the trading begins

FairSwap is a Uniswap inspired DEX with front-running prevention systems built into its design.

In order to provide users with a “fair price”, orders on FairSwap are processed differently than other exchanges.

When trading of the LIEN/iDOL pair begins on September 7, 2020, at around 13:00 UTC, we expect trading to start with buy orders exceeding sell orders, causing slippage to exceed the maximum limit of 5%.

When orders cause slippage to exceed 5%, those orders will get settled pro-rata based on their respective order size, up until the 5% slippage point.

For example, if you placed a buy order for 10 LIEN tokens along with buy orders for 90 LIEN tokens placed by other people, your order represents 10% of the group of orders (10 / (10+90) = 10%).

Let’s say that this group of orders causes a slippage of 10%, exceeding the permitted maximum slippage of 5%.

The order size up until the slippage point of 5%, will get settled pro-rata based on their respective order size.

Let’s say for simplicity sake, 50 out of the total buy orders for LIEN were allowed to get settled in this transaction and because your order represented 10% of the group of orders, 5 (10% of 50) LIEN tokens will be settled and the remaining amount will be refunded to you.

The key message here is that one should expect that their orders might not get settled in their entirety and carefully consider gas fees among other things when placing orders, especially right after trading begins.

In the following section, we cover in detail how the orders are executed on FairSwap.

What is FairSwap

FairSwap is designed to make sure that transactions are settled in a fair manner by implementing the Frequent Batch Auction mechanism, which is a countermeasure implemented in traditional financial markets to prevent front-running observed in high-frequency trading (HFT).

In addition, the liquidity is provided through the AMM (Automated Market Maker) mechanism, allowing for Uniswap-like trading experience.

As a result, Uniswap and FairSwap have different ways of implementing transaction settlement.

In Uniswap, transactions contained in the same block can have different settlement prices depending on the order in which they are included in the block.

In FairSwap, on the other hand, transactions included in adjacent 2 blocks are settled at the same price regardless of their positions within those blocks.

As mentioned in the previous section, when an order with 5%+ slippage is placed, the order might not be filled fully.

For example, if a buy-order of $100,000 is placed on the platform but the maximum value of order with 5%+ slippage allowed on the platform turns out to be $25,000 on these two blocks, only 25% of the order will be filled, with the remaining amount refunded to you.

We will release an article covering this topic soon.

LIEN specification

Total Supply: 1,000,000 LIEN (Capped)

Initial Circulating Supply: 200,000 LIEN (20% of total supply)

Token Type: ERC20 on Ethereum

Contract Address: 0xaB37e1358b639Fd877f015027Bb62d3ddAa7557E

Initial Token Distribution

Frequently Asked Questions

Q: What is the total supply of LIEN and is the supply capped?

A: The total supply of LIEN is 1,000,000 and yes, the supply is capped.

Q: When is the snapshot to determine the fee allocation for a certain period taken?

A: Every 28 days starting from August 8, UTC 13:31:50

Q: I sold my LIEN tokens before the snapshot date. Will I be eligible for the distribution of fees?

A: No. In order to be eligible for fee distributions, you will need to hold LIEN tokens when the snapshot is taken.

Q: Is there a time limit as to when I can redeem the fees that were allocated to me?

A: You have 48 weeks to redeem the fees that were allocated to you. If the fees are not redeemed within 48 weeks, they will be forfeited and included in the next fee allocation pool.

Q: What is the utility of the LIEN token?

A: The Lien token (LIEN) is a utility token that the holders can use to receive discounts on the protocol fees that are required when using the Lien protocol and trading on FairSwap.

Q: Can I expect the price of the LIEN token to increase in the future?

A: No. Users of the Lien token should not expect the price of the Lien token to go up.

The token is not meant to be an investment or speculative vehicle.

Q: Was there a presale of LIEN tokens?

A: 10% of the total LIEN token supply was sold at approximately 50 USD per token to early contributors in order to provide initial liquidity on FairSwap to ensure smooth trading from day one.

Disclaimer

  • This article does not constitute an offer to sell the LIEN token in an illegal jurisdiction.
  • All or part of this article is not legal, financial, tax or other professional advice, and should not be considered as such. Before deciding to buy or sell the LIEN token, you should seek independent expert advice. You are responsible for evaluations and decision-making made during the LIEN token purchase or sale process.
  • The LIEN platform is fully functional in its current state and holders of the LIEN token should not expect it to be further developed by the current community.
  • The purchaser of the LIEN tokens should not expect the current community nor anyone else to build or grow the value of the network or the LIEN token.
  • The LIEN token is not intended to constitute securities of any form, units in a business trust, units in a collective investment scheme or any other form of investment in any jurisdiction.
  • Holders of the LIEN token should not expect the proceeds from the sale of the LIEN tokens to be used to further develop the network or the LIEN token.
  • The purchaser of the LIEN token should not expect future functionality of the network or the LIEN token.
  • The purchaser of the LIEN token should not expect potential profitability of the operations of the network, or the potential appreciation in the value of the LIEN token.
  • The purchaser of the LIEN token should not expect the availability of a market for the trading of the LIEN token.
  • To the maximum permitted by law, we are not responsible for any liability arising from the adverse effects or consequences of the LIEN token.
  • This article describes our current schedule for the LIEN platform. While we aim to realize this schedule, please recognize that it is dependent on quite a number of factors. We do not guarantee, represent or warrant any of the schedules in this article.

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Lien Protocol

Lien Protocol

A governance-less protocol for creating Options & Stablecoins from ETH. https://lien.finance