BluDAC has launched a rocket in the shape of third party liquidity pool rewards for tokens on the WAX blockchain, with more chains to follow.
This article has been updated to include unstaking information & explained LP tokens in more detail
- Updated -24/10/21 - Craig Fulton
Liquidity Pools on the Alcor Exchange incentivise liquidity providers by distributing transaction fees (0.3%) for every trade made from the pool. The larger the share the liquidity provider has, the bigger the slice of the transaction fees they get.
However, sometimes this incentive isn't enough to encourage people to provide liquidity. BluDAC aims to dramatically deepen liquidity pools by further rewarding liquidity providers with $BLU, a new token designed to create liquidity oceans!
1. $BLU Rewards
Every token that gets a $BLU token pair listed on BluDAC (e.g $BLU/$CAIT), will receive a 5 million $BLU reward pool in the first month!
For example, if you have a 1% share of a $BLU liquidity pool for the entire first month, you would receive a total of 50k $BLU tokens. This is a very high reward to encourage fast liquidity across a wide range of tokens.
The total PROMO budget for setting up new token pairs with a 30-day reward pool is 5 billion (of a 30B max supply). Next year, new project tokens on Blu DAC will receive a reward pool of 2.5 million.
The promo reward pool will continue to be cut in half every 6 months.
After the PROMO reward pools are over, Blu DAC will be awarding 1 million $BLU pools annually to the best communities. There is a long-term DeFi reward pool of 10 billion $blu, designed to last for 100 years. So you can keep earning that sweet $BLU for many years to come.
For the community
There is a bigger reward here than the $BLU tokens. We just have to look at the name, BluDAC.
In an algocracy (government by algorithm), DAC stands for decentralized autonomous corporation. Blu DAC aims to achieve exactly that, by building this for the community and then giving it to the community within three years!
BluDAC has already partnered with some of the biggest blockchain projects:
The list of partners keeps growing quickly as more realise the potential of this innovative project. Nine more have requested to join since memberships went on sale! You can also join BluDAC if you have your own NFT project.
Sounds good! So, what do I do now?
You will need a membership to get the benefits of being in a $BLU liquidity pool.
There is a max supply of 100k memberships, each released in tranches of 10k. However, they will be released across many blockchains, such as BSC and EOS. We expect only 20-30k will be released on WAX.
All memberships are equal, you only need one to play (can always buy more to support the project) though there is a limited quantity at the lowest ask price of $10, with each tier increasing by $10 (up to $80 total).
Memberships went on sale October 14 @ 12:00 ET on NeftyBlocks, with the majority of the lowest tiers already sold out:
3. How do I join a $BLU Liquidity Pool?
If you have never joined a liquidity pool before, read our guide on Yoshidrops liquidity pools:
It's essentially the same process, except you will need $BLU as your first ingredient (massive liquidity for $BLU/$WAX was added on 14 October, so you will have no problem buying $BLU), alongside the $TOKEN you want to provide liquidity for.
When providing liquidity, add $BLU in asset 1 on the Alcor Exchange. Then search for the $TOKEN you would like to provide liquidity for in asset 2.
When providing liquidity, you will receive LP (Liquidity Provider) tokens in return. LP tokens represent your % of the total LP token circulation within that pool.
For example, if you were to provide liquidity for BLU/VOID, I would receive the LP token BLUVOID. I can see how much BLUVOID I would receive underneath the Provide Liquidity Button:
In this example, we would receive 122,412.9512 BLUVOID LP tokens, which is representative of 1.79% of the total BLUVOID in circulation (your % share of the pool). Nice!
Once you have provided liquidity, you will stake on bludac.io to receive your rewards.
4. Stake on bludac.io
Once we have our membership and we have provided liquidity on Alcor, we can now hop over to bludac.io to work some magic.
You can watch this great run-through for all the steps needed to play BluDAC:
You can also follow these steps to get started with staking:
Connect your wallet
Simply connect your WAX Cloud or Anchor wallet.
Accept the terms
Next, you will see the terms you need to board this rocketship. Don't skip the terms, READ THEM, understand what you are signing up for!
Choose your token pair
Now we are going to choose a token pairing to stake against. We will choose BLULIFT ($BLU/LIFTIUM) as we have provided a small amount of liquidity for this on Alcor.
Just tap Details over to the right to expand the staking options:
Harvesting yields will appear every 24 hours, after the first full epoch (so 48 hours the first cycle, 24 hours thereafter), midnight GMT to midnight GMT.
The team are still working on the AIMY function and plan to introduce improvements to work out your expected $BLU earnings. Basically, AIMY is the expected daily $BLU earnings per LP token you have staked (Personal Staked total)
You will also see the Total staked, the Ends In timer and your Personal Staked total (zero for now of course).
Stake your membership
Tap on stake and you will first need to stake your membership. You only need to do this once, you won't see this again when you stake for a different token pair.
Get staking & board the ship
Once you have staked your membership, you can now enter how much of the token pairing you want to stake.
BLULIFT is the token we receive for providing liquidity for the token pair $BLU/$LIFTIUM on Alcor. The more liquidity we provide to this pool, the more BLULIFT we receive and the bigger the share of the pool we own.
We are going to stake all the BLULIFT we have:
Once you approve the transaction, that's it, you are on your way to earning that sweet $Blu!
When you expand the details on your chosen token pairing, you can see your personal staked total.
You now have your seat on the journey to the intergalactic realm. Just sit back and enjoy the ride.
Want to stake for other token pairings? Just repeat the above steps.
You can also unstake at any time by tapping the Unstake button:
You can then select the amount of LP you would like to unstake from your personal staked total.
Just keep in mind that it takes 3 days for your stake to be refunded from the time of the unstake request.
A fee may also be charged (Blu deducted from your harvested balance), which can be seen in the Unstake pop-out.
5. New Rockets, New Chains
BluDAC announced on October 30 that they are launching on the Polygon Blockchain.
Read everything about the Polygon Launch:
6. Add custom tokens to your WAX wallet
Now that you have $BLU, you might want to see this in your WAX cloud wallet.
To do this you just need to add a custom token, which is really easy to do. Our article explains how to set this up:
7. Ok, what the heck is a Liquidity Pool?
More and more NFT projects are utilising DeFi as a source of unlocking additional value for their projects. There is one problem: Liquidity.
If you are wondering what the heck is liquidity, let's take the simple bagel as an example. Without enough sellers/buyers of bagels, you can't buy/sell the bagels in the quantity or the price you want.
Liquidity pools solve this problem by providing pre-funded liquidity. Think of it like the DeFi bagel supermarket. Now you can buy your bagels directly from a well-stocked shelf, without the need to find individual sellers. Nice!
We just need to make sure the liquidity pool is deep enough to keep those bagels flowing out the door. Instead of bagels, as delicious as they are, we are trading in crypto tokens such as $NEFTY or $YOSHIBK.
So who provides the liquidity in a liquidity pool? Well, it could be you! Liquidity pools are crowdfunded through people willing to provide liquidity.
There are risks associated with providing liquidity, as there are rewards and additional incentives that Blu DAC is centred around.
8. Keep Updated
We will continue to expand our content on Blu DAC as the project gets off the ground. Keep updated with these tips:
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arodie.com articles are not financial or investment advice.