Redacted v2: A New Era
At New Order we pride ourselves on our ability to incubate and ship innovative projects. They start off as an idea within the DAO, we vet the idea’s legitimacy, then we deploy talent and resources to bring the idea to life.
Redacted introduced itself to the world on November 1, 2021. It has since grown from an idea within New Order to one of the most exciting projects in DeFi. Now that Redacted has released v2, which introduces new tokenomics and a new focus, we thought it’d be a good time to retell their story.
The Beginning
In late 2021 Olympus DAO was taking the crypto ecosystem by storm and lit the fire that started the DeFi 2.0 narrative. OHM was on a historic speculative run and its treasury was growing at a rate no one had seen before. Projects began to realize that despite the tradeoffs of OHM’s tokenomics, the bonding mechanism they used represented a unique opportunity to bootstrap a project’s treasury.
While that was going on, the Curve flywheel had also started spinning. Convex was absorbing veCRV and protocols were battling it out through bribes and other means to receive CRV emissions and bolster their liquidity. It was clear that whoever owned the most CVX and the most CRV would have an important role to play in DeFi’s future.
Between these two ecosystems laid an opportunity.
The Idea
The idea was simple: what if a project leveraged the Olympus DAO model to acquire CVX and CRV to have a significant say over Curve’s gauges? What if the project created a blackhole for CRV and CVX and manifested a DAO that had a majority say in the Curve’s future? The first DAO political party? Gauge-as-a-service? Why not?
Thus, the idea behind Redacted was born.
After spending more time building out the concept, it was decided that Redacted would incentivize bonding tokens from the Curve ecosystem into the treasury in exchange for the BTRFLY token. Each BTRFLY token would be “backed” by value from the Curve ecosystem.
The Launch
After New Order developed the idea and introduced Redacted in November 2021, the Redacted team moved forward with a Treasury Bootstrapping Event to kickstart the treasury and begin BTRFLY distribution. It was a two day event in December 2021 where participants could trade CRV, CVX, and OHM in exchange for BTRFLY. The event was a massive success.
When it was all said and done, Redacted was able to bring >$70,000,000 to its treasury. ⅓ of the treasury consisted of CRV, ⅓ consisted of CVX, and ⅓ consisted of OHM. Redacted was now an undeniable force in the Curve ecosystem.
Post-launch Growth
After Redacted’s Treasury Bootstrapping Event, it didn’t stop growing and innovating. Soon after launch, Redacted expanded its reach to the Frax and Tokemak ecosystems through TOKE and FXS bonds. Its treasury expanded and so did their ability to earn revenue and establish their influence.
Redacted’s next pivotal moment was its vertical acquisition of Votemak. Votemak was a bribe marketplace built on top of Tokemak. For context: Tokemak hosts C.o.R.E rounds which allows TOKE holders to vote for what projects should be added to the Tokemak protocol. Votemak allowed participating projects to “bribe” (i.e. incentivize) voters to vote in their favor. But, Redacted’s plans for Votemak were more ambitious.
After acquiring Votemak in January 2022, Redacted introduced Hidden Hand later that month. Hidden Hand took the principles underlying Votemak and generalized them to create a bribe marketplace that could serve any DeFi protocol. The flood gates to the bribe economy were open.
The creation of Hidden Hand represented a philosophical shift for Redacted. They had established a powerful treasury and their influence in DeFi, but there were more opportunities for the taking. Redacted decided that being a participant wasn’t enough and that building products that empower on-chain liquidity, governance, and cash flow for DeFi protocols would be its future.
A few months later, in May 2022, Redacted launched another innovative product called Pirex. Pirex creates liquid wrappers for assets that allow for auto-compounding and the tokenization of future yield/vote events. pxCVX (Pirex vlCVX) was the first Pirex liquid wrapper under the Pirex banner.
With two product launches under its belt, it was time to embrace the new direction.
Redacted V2
Since their launch, Hidden Hand and Pirex have both found quite a bit of adoption in their verticals. Hidden Hand has facilitated hundreds of thousands of dollars in bribes across the Balancer, Aura, Tokemak, and Floor DAO marketplaces. Pirex has received >900,000 in CVX deposits with more coming in each day. Both products are also generating meaningful revenue for the Redacted treasury, but why stop there?
We mentioned earlier that despite the benefits of the Olympus DAO model, it comes with tradeoffs. The biggest trade off is the dilution of token holders. Since Redacted was now well established and earning revenue, it didn’t make sense to continue diluting holders for little benefit.
So, they built out a new token model for BTRFLY and introduced “revenue locked BTRFLY” (rlBTRFLY) via governance. The new tokenomics would sunset the Olympus model, introduce a hard cap of ~5M BTRFLY, get rid of BTRFLY staking, and use BTRFLY inflation effectively.
With the dilution problem solved, rlBTRFLY would be a mechanism for long-term holders. Through rlBTRFLY, holders can lock their BTRFLY tokens for ~16 weeks at a time to receive the revenue earned from Redacted’s treasury and products. Lockers will also receive BTRFLY inflation, rewarding long-term holders with more governance power.
A New Era
Redacted V2 finally went live on August 8, 2022. Beginning a new era for the project. Instead of bonding and diluting holders to grow the treasury, Redacted will launch products that align with their mission. These products will earn revenue for the treasury, and earn revenue for rlBTRFLY holders.
We couldn’t be more proud of how far Redacted has come in less than a year. We recommend users migrate their BTRFLY v1 tokens and keep track of the team’s progress. They move quickly and unapologetically and they’re at the forefront of innovation in DeFi.
We hope you’ve enjoyed this trip down memory lane, as it’s been a fun journey for us. Redacted is a prime example of the types of projects we like to foster at New Order and we look forward to more incubated projects replicating their success soon.
If building edge-of-the-edge DeFi products interests you, get involved with New Order today. We’re always looking for talent.
