We are minutes away from the launch of the bootstrap phase! It’s time to let everyone know about the stages, contracts, stabilization fund, the timeline… well, about everything. This is your main FAQ for the first days of Klondike’s life. Make sure to not miss anything. LFG!
Farming and rebase stages
Bootstrap phase first 5 days: liquidity begets liquidity.
The bootstrap phase is there to get the early community involved, distribute supply in a more fair way, and kickstart the liquidity — which is the most important feature of any synthetics protocol. During that period the supply of kBTC goes from 2 to 5, and the supply of KLON goes from 0 to 34,675 KLON. Anybody can join.
How to get kBTC:
- kBTC supply starts with 2 kBTC in total. If you didn’t get it, there is no issue. You simply acquire some kBTC from the kBTC-WBTC Uniswap pair after at least one of the testers supplies it to the Uniswap pool.
- There are also 3 pools with no impermanent loss: WBTC, renBTC, and bDIGG which you can deposit into and get your share of the 1 kBTC in each of the pools distributed per block over the bootstrap period of 5 days. This is to get a more fair distribution of kBTC and allow others to participate.
How to get KLON:
KLON starts with 0 supply and is only available for mining in the kBTC-WBTC pair or the KLON-WBTC pair. Awarded per block up until the governance decides to circumvent these rewards once the protocol reaches the next stage of stability and trust in the DeFi community. The rates of farming are as follows:
- KLON <> WBTC: 684.9315/day
- WBTC <> KBTC: 6250/day, decreases 75% every 30 days.
Discussion on the reduction rate in Discord.
Past the bootstrap stage after 5 days, the rebase mechanism starts and the stabilization fund kicks in. This is where the sauce is, read about this below.
- 2kBTC among 100 wallets of testers and early DeFi degens who help kickstart liquidity. It’s a nominally tiny amount, simply to get the pools seeded with liquidity.
- In the first 5 days, the supply of kBTC will go to 5 kBTC maximum.
- KLON supply starts from 0 and goes to 34,675 in these 5 days.
Any supply fluctuation beyond the bootstrap phase is part of the complex math with rebasing and the stabilization fund. In short, if the price of kBTC stays reasonably above 1:1 kBTC to BTC, then KLON holders will mine more kBTC as well. Read more below.
Three token model
If you are familiar with Basis Cash, you are basically in the know of everything with one exception of the stabilization fund. The model has three tokens, but in our case, more:
- Seigniorage share: $KLON — starts with 0 supply. It’s a volatile token, the heart of the system basically. The governance rights grantee. After the bootstrap phase, when the rebasing system comes into play, holders of KLON receive synthetic assets when rebases are positive. The more synthetic assets we add, the more potentially you can BRRRR. It’s a “one seigniorage to rule them all” scenario.
- K tokens: those are split in two — the bond token and the synthetic asset. Since we start with Bitcoin, it’s kBTC and kBOND. If we do YFI, it’s kYFI and kYOND or something like that (we can decide on this later). These two are directly related to the peg stabilization and liquidity, working on stabilizing the 1:1 peg from either side with incentives.
Read more into the design and the stabilization fund here:
Protocol design — the new approach for synthetic assets on Ethereum
Our goal is to create a platform for various synthetic assets based on an improved Basis stabilization model with the…
How to participate
- Get kBTC either of the ways:
- Deposit WBTC, renBTC or bDIGG into one of the three no-IL pools
- Buy kBTC from Uniswap (contract not yet deployed)
2. Supply liquidity to kBTC-WBTC and stake in the UI. This farms KLON.
3. Supply liquidity to KLON-WBTC and stake in the UI. This farms more KLON.
Contracts, admin functions and DAO
Never trust anon devs!
To make sure you don’t need to trust us, we are not reserving any crucial admin functions which give us access to the treasury or anything of that sort*. Here are the contracts for you to verify and go through. Please make sure to fact check us!
- KBTC (0xE6C3502997f97F9BDe34CB165fBce191065E068f)
- Kbond (0xA8c2af8c403704a31F32F0aa70a43e63aFcd54d0)
- Klon (0xB97D5cF2864FB0D08b34a484FF48d5492B2324A0)
*The stabilization fund kicks in only after 5 days, so any issues spotted can be patched right away. There is a time-lock on the functions. Again, if you spot any weird things, send them in Discord or on Twitter. We will fix it with full transparency.
Responsible Disclosure No1
The amazing 0xdev0 and vfat pointed out the issue related to the trader of the stability fund. We have addressed this point and will update it well before the bootstrap period ends. Please find the response here.
No-IL farming contracts have been taken from Basis Cash, essentially the same Synethtix contracts which have been used throughout 2020. We can’t change the reward rate, we can’t take money out of there. The issue with possibly locking the funds permanently as pointed out (here) is also being addressed. See on telegram as well.
Everything is essentially on a 2-day timelock, which we would also want to migrate to the signatory participants in the coming weeks. And we want to delegate the treasury to the DAO as soon as possible to have community control the most vital functions!
We have to note here that for now we will be clicking the buttons for stabilization, however, we can’t do much else or access the funds. We will be looking to delegate this to the DAO as soon as possible or integrate with KP3R. Ideas are welcome!
- Treasury: https://etherscan.io/address/0x3249A682779fe2C3dd3B37D3A7347aaFe06D49DA#readContract
- Operator: https://etherscan.io/address/0x2c5ba02bb750a24af83105bed28734e0e22933df#code
- Owner: https://etherscan.io/address/0x2c5ba02bb750a24af83105bed28734e0e22933df#code
WARNING: although the contracts are mostly forked, some features have been tweaked. Any security risks are fully on the user side and we wouldn’t be able to reimburse any losses incurred. Please perform audits yourself and read the code!
The Discord and Telegram are now open!