A comprehensive guide to the PIPT token
The Baby Power Index was launched less than 5 days ago and almost instantly reached a hard cap of $200k. The cap would be expanded soon.
However, we found out that a significant share of the community doesn’t understand what a PIPT token is and how it is connected with Power Index and Powerpool in general.
This article is written to provide a comprehensive guide to PIPT and put an end to the questions like: What the hell is PIPT? Would it be pumped?
We will help you to understand what is PIPT step-by-step.
DISCLAIMER: Almost all stuff here is significantly simplified for the general audience.
Power Index is the Defi index, consisting of governance tokens. It is the contract (the pool), which stores 8 governance tokens and allows:
- to operate with a basket of 8 tokens using only one asset — PIPT. You can store this token and trade it.
- to swap these 8 governance tokens between each other
- to use other functions, which are not relevant in the context of this article (voting, etc)
Baby Power Index — capped version of Power Index, which you operate with (the main Power Index isn’t launched yet). The current hard cap is $200k and will be expanded soon.
PIPT = Power Index Pool Token. It is the token, representing a share of the index.
When someone supplies liquidity in the pool — the contract mints PIPT in exchange for 8 GTs.
Use the “add liquidity” button here to do this.
When someone removes liquidity from the pool, the contract burns PIPT and sends 8 GTs to the address, which initiated the operation.
Use the “remove liquidity” button here to do this.
The circulating supply of PIPT can change every block — it is connected with minting/burning operations.
How to issue (mint) PIPT?
You need to supply liquidity into the index in order to issue new PIPTs. Currently, you need to provide 8 GTs at one time but in the future it will be simplified.
Roadmap: (1) an option to use ETH for instant buying 8 GTs from Uniswap (2) a single-side liquidity provision option — you would be able to use only one of 8 GTs to supply liquidity.
What is the PIPT price and why it changes?
PIPT price isn’t connected anyway with Powerpool, Power Index, or price of CVP.
It is based on the prices of index tokens — YFI LEND SNX COMP MKR UNI WNXM CVP. Each token has ⅛ share in the index.
At the moment of pool deployment, PIPT was ~$1. Its difference from $1 is connected with the market and fluctuations of GTs prices.
So, PIPT cannot be pumped easily. PIPT price grows if the market grows, and falls if the market goes down.
What is the “fair” price of PIPT? How can I calculate it?
It is easy. The algorithm:
- Check out the Power Index contract: https://etherscan.io/address/0xb2B9335791346E94245DCd316A9C9ED486E6dD7f
- Check out the PIPT circulating supply: https://etherscan.io/token/0xb2B9335791346E94245DCd316A9C9ED486E6dD7f
Calculate the “fair” PIPT price. Currently 199,961 PIPT is issued and $228,500 is stored on the Power Index contract, so the fair price is: $228,500/199,961 = $1,143
Do I need to buy PIPT from Uniswap? Or it is better to mint it?
On Uniswap there is a PIPT/USDC pair. It was launched to allow Defi users to buy and sell PIPT in one click.
Don’t buy PIPT from Uniswap if the market price significantly differs from the “fair” one.
I own PIPT. What can I do with it?
First of all, you can use it to trade 8 GTs using one asset. Besides that, you can participate in the Liquidity Mining program and earn CVP. There are two options to do that:
- [SIMPLE OPTION]: stake PIPT in the special contract. Use this link and the “deposit” button there.
- [AN OPTION FOR ADVANCED USERS]: supply liquidity to PIPT/USDC pair. Stake your UniV2 LP tokens to get rewards here.
