Pylon Protocol — Roadmap and Monthly Update [August 2021]

The aim of Pylon Protocol’s monthly update, to be written periodically, is to review protocol updates since the MINE token launch, as well as to pan out Pylon Protocol’s roadmap for growth beyond Pylon Gateway.

Pylon Protocol’s Value Proposition

With the aim of bridging DeFi yield farming and long-term service payments, Pylon Protocol aspires to reimagine incentive alignment between creators and users, projects and investors, and artists and fans.

An elegant way to sum up Pylon’s value proposition is that users pay for services with opportunity cost, substituting direct payments-in-principal with payments-in-cashflow.

By inputting a fully withdrawable, no-loss deposit for an extended duration of time, users receive access to various services, the first of which is access to project tokens via Pylon Gateway.

June/July Retrospective

Towards the end of June, the community witnessed the premiere of Pylon Gateway, Terra’s first token launchpad, demonstrating the proof-of-concept of Pylon’s fundraising-via-yield.

MINE Token Launch

The first amid the cascade of projects set to launch on Pylon Gateway was our very own: Pylon Protocol’s native governance and utility token, MINE.

MINE is a token that accrues value via a portion of all yields generated across all Pylon-powered platforms being designated for token buybacks, in addition to platform-specific rewards for MINE stakers, including but not limited to early access to token launches on Pylon Gateway or exclusive access to tier-based content on secondary platforms.

Users can currently trade MINE on TerraSwap and on Pylon WebApp. Users can stake MINE on the WebApp and provide liquidity to the MINE-UST pool.

MINE Wave 1 & Wave 2

The first sequence of the MINE token launch via Pylon Swap, a virtual fixed swap pool where users were able to swap UST for MINE, as well as the one-month lockup unlock, progressed successfully.

With over $2M UST raised in 46 minutes and each wallet capped at $10K UST, the first wave of Pylon’s launch aimed at a community-centric “fair launch,” in line with our vision for Pylon to fully decentralized, owned and governed by the community by end-of-year.

The second sequence of the MINE launch, that is, three Pylon Pools on Pylon Gateway where users can stake Terra’s stablecoin (UST) to receive corresponding MINE token rewards, remains open on Pylon Gateway for investors to enter at any time before vesting period expiry.

Funds raised from the Pylon Swap and ongoing yields from Pylon Pools have so far been and will continue to be used to provide liquidity on the MINE-UST pair, pay for project expenses (including contract audits, marketing, wages for external developers, etc.) and serve as a community reserve to fund new projects and integrations to expand the Pylon ecosystem.

The Multiple Wallets Problem

Given that project tokens in Pylon Pools are distributed pro rata to the amount staked and that investors can jump into each pool anytime (although, the earlier the more rewards), the “fairness” concern associated with the multiple wallets problem does not arise for Pylon Pools.

On the other hand, the multiple wallets problem may arise for Pylon Swap, where multiple wallets could potentially abuse the maximum cap limit per wallet by creating a number of different wallets.

A combination of the following measures will be taken to prevent the abuse of multiple wallets (or to render it pointless) while also rewarding MINE stakers and making the protocol accessible for as many community investors as possible:

1. Lockup prerequisites.

In order to participate in Pylon Swap for a project, an investor must have long-term incentive alignment with Pylon Protocol (or at least with that particular project).

In practice, this looks like implementing a ratio-cap per wallet such that an investor must deposit into Pylon Pools for MINE (or for a particular project token) and/or be staking (X amount of) MINE per (Y amount of) extra allocation in order to participate in Pylon Swap or receive other exclusive benefits (i.e. early access, higher cap, etc.).

2. Snapshot lottery.

Using random seed, a snapshot “lottery” can be realized in a number of different ways.

The first way of implementing this would be that a select number of MINE staker wallets can be chosen to be whitelisted via lottery, while providing wallets with high amounts of MINE staked with a higher probability of being selected (pro rata to their amount staked and total duration of MINE staked). Whitelisted wallets will be able to partake in, for instance, an exclusive Pylon Swap sale with a fixed maximum cap.

The second way would be as follows: instead of whitelisting particular wallets, a fixed number of snapshots taken across all staked MINE can be used to provide a fixed max cap allowance. For instance, if we were to take 2,000 snapshots across all MINE stakers, each snapshot may allow that particular wallet to deposit X more UST into the Pylon Swap pool.

Both snapshot lottery approaches depend to some degree on luck, preventing single whales from absorbing the entirety of the token launch allocation while allowing smaller MINE stakers to take part in Pylon Swap pools. All the while, this prevents those with multiple wallets from abusing the system since there is no additional benefit to be had for staking MINE on multiple wallets, which would in turn only dilute one’s pooled chances of getting whitelisted.

Recap of MINE Staking Rewards

All in all, provided either approach to the multiple wallets problem, MINE stakers will be utmost rewarded on Pylon Gateway, with greater opportunities and benefits given to individuals staking a significant amount of MINE.

As extensively outlined in a previous Medium post about MINE staking rewards, MINE stakers will receive 20% of all yields generated on Pylon Gateway via token buybacks, which is projected to grow over the long run as more projects launch via Pylon Pools.

As per standard, every project that launches via Pylon Pools will have to designate a portion of their tokens in airdrops for MINE stakers — to be distributed over time, not in a singular genesis snapshot.

There is plenty of room for utility design in terms of perks for MINE stakers, which will continue to accumulate on Pylon Gateway as well as secondary platforms powered by Pylon.

Pylon Gateway Token Launch Lineup

As soon as each project is ready to deliver, the following tokens are confirmed for launch on Pylon Gateway later this month: Nebula Protocol, Loop Finance, and TerraWorld.

Please redirect queries about launch delays and specific launch dates for project tokens to each project team. On the part of Pylon Gateway, we are currently ready to accommodate token launches at any moment’s notice.

Pylon Protocol Roadmap

One common circulating misconception is that Pylon Protocol is simply a “fair” token launchpad for Terra and that its use cases are reserved for that sole purpose only.

Although Pylon Gateway is a powerful proof-of-concept and flagship platform for yield redirection and no-loss services (i.e. token crowdfunding), it is not exhaustive of the potential of the protocol.

As a framework for yield redirection, Pylon aims to provide a seamless user experience for payments via yield, realized via widget integrations and various secondary platforms powered by Pylon, one of which includes the continuous growth of Pylon Gateway.

Pylon’s vision for the user can be aptly summarized into the following catchphrase, “Deposit Now, Pay Never.”

Pylon’s Third Wave

To elaborate on Pylon’s launch of wave three as alluded to in previous posts, the main task that the core team is working on is building out the widget, plugin, dashboard, and SDK for other projects and sites to integrate a simple “deposit to pay” experience.

Based on this foundation, we will be able to rapidly ship a number of products and services ranging across different industries, allowing third-party builders to integrate Pylon’s deposit-to-pay interface into their platforms.

As for our go-to-market strategy, our initial focus will be on familiar crypto-native platforms within and beyond the Terra ecosystem, but our long-term aspirations extend beyond the crypto space. Pylon aims to tap into new arenas of real-world use cases, ranging from subscriptions and memberships, artist patronage, and rentals for spaces in both physical and virtual worlds.

A number of industry players have reached out about the possibility of integrations, which we will pursue as soon as our “Deposit with Pylon” widget is fully functional.

Secondary projects that are currently in development in-house include:

1. a community bounty and grants interface where patrons can stake Terra stablecoins in order to dole out Terra grants to projects via yield redirection in a sustainable manner, with continuous funding conditional on each project achieving particular milestones.
2. a decentralized patronage hub where users can stake Terra stablecoins (with yield redirected to artists, creators, or service providers) in return for NFT airdrops, gated content, and membership services.

Developers, app-builders, and project teams hoping to build their own secondary front-end integrations and applications for Pylon are encouraged to reach out to the core team and look into how Pylon’s smart contracts have been configured via Github and Pylon documentation.

To recap, at least 10% of yields across all Pylon-powered projects will be sent for token buybacks in order to accrue value for MINE stakers.

Beyond the MINE token buybacks, every in-house secondary platforms for Pylon will be integrating other exclusive perks for long-term MINE stakers: periodic and retrospective snapshots have been and will be continually taken to determine a wallet’s total duration of stake.

Expanding Pylon Gateway

Following the token launches in August, Pylon Gateway will be gradually opening up to accommodate a completely permissionless token whitelisting and launch process, alongside community-driven due diligence.

In addition to the core team’s more active presence on the Pylon Forum to kickstart discussions regarding proposals for new projects and community grants, governance polls for MINE stakers will be opening up later this month to allow users to participate in protocol governance.

MINE Token Listing

On the roadmap for August, there will be CEX listings coming up, in addition to listings on CoinGecko and CoinMarketCap.

Look out for further announcements.

We’re Hiring

Based at Terraform Labs, Pylon Protocol has been continuing to expand the core development team in order to deliver improved user experience, solidify Pylon Gateway’s underlying infrastructure, and respond to UI bugs and user concerns as soon as possible.

That said, we will be opening up a hiring round for developers and product builders in the community to join us and further our vision for growing Pylon and Terra’s ecosystem. New hires will be assigned to helping us to build new products and to maintain current infrastructure.

If you are interested in learning more, please send in your portfolio and CV to <contact[@]pylon.money> or apply through the Terraform Labs job portal.

Join our team and construct additional pylons.

Applications will be reviewed on a rolling basis.