Hello and welcome to The Ether. Today is Friday, March 4th 2022. This episode of The Ether is brought to you by Talis. Talis Protocol is the NFT platform for independent artists on Terra. Talis helps to provide artists with the tools and resources needed to transition from traditional arts into the NFT world. With their V1 launch coming soon, Talis will be the place to see real world art reflected on Terra. Be sure to join their Telegram and follow Talis on Twitter for updates on their roadmap, validator, and other Talis news. Find your next favorite artist on talis.art. This episode of The Ether is also brought to you by WeFund. WeFund is a community crowdfunding cross-chain incubator on Terra, and it’s the first launchpad that implements a milestone funding release system to protect investors. All money raised for projects is deposited in Anchor Protocol and it’s refundable, and all decisions are based on community voting power. WeFund is community focused and designed to be a user friendly experience for both project creators and investors. Be sure to follow them on Twitter and join the Telegram for more information. Links are in the show notes and check them out online at wefund.app. TerraSpaces appreciates the support from all our sponsors. Today on The Ether, Prism Farm Live on Monday, All Questions Welcome. Let’s take a listen.
Ask silly questions aecause we know a lot of people are kind of still struggling to get their head around Prism. Although ultimately, once you do get on there you realize it’s a lot of DeFi functions that you’re really familiar with, whether that be trading or staking or LPing. I guess there’s just a little bit more strategy around it than some of the other protocols on Terra. So if anyone wants to jump up and ask a question, you’re more than welcome. And I’ve already dragged up Prism bull Farmer Brown onto the stage. Hey, man, it’s been a while since we spoke. I don’t think I’ve spoken to you since some of the Terra Bites happy hour days. How are things?
Farmer D Brown 2:54
Yeah, good. Nice to connect with you guys. Quick question, the farming rewards, will they be automatically staked so that if people go to dump them, they’ll lose their AMPS? Or how will that work?
This is a good question. So obviously, we have a 30 day vesting period on the farming rewards. So again, I think a lot of the tokenomics we designed so that there’s no sort of mass unlocks and it’s gonna be a steady trickle in terms of emissions. When it comes to the farming rewards people will have the option of what they want to do with those rewards. So we’re going to have, in the interface, similar to when you collect your yLUNA staking rewards now, you can choose to sort of claim them as they are or automatically swap them into pLUNA, yLUNA, PRISM, and xPrism, whatever you want to do with them. Ultimately, I think it’s probably a little bit unfair to punish people by removing their AMPS that they’ve built up but we will be offering various options when you come to claim those, so you will be able to claim and automatically pledge those or claim and convert to xPrism, or you will be able to claim in native just PRISM and I guess to a certain extent do what you want with those tokens. Jimmy, I don’t know if you’ve got anything to add on that.
Yeah, I think that’s the gist of it. But yeah, I’m curious, super curious to see what’s going to happen. And then I just briefed Alex, Incioman, and some of the Flipside guys, so we’re gonna have some analytics ready for you, hopefully right around the time the farm is ready, and we’ll build on top of it afterwards. So you’ll kind of get an idea of once they claim their PRISM tokens, what are people dealing with it? Are they repledging, or they’re dumping, or just going to xPRISM, what are they doing? So it’ll be interesting to see.
Yeah, I think just maybe one thing just to add, because I think the question is really, are people just going to get these PRISM rewards, and then dump them? I guess there’s a risk that happens. One of the things that Hyperion was talking about with Cephii on Spaces earlier today is that we’re starting with this kind of 80:20 split in terms of the base pool, and the boosted pool. And I think, as Jimmy just mentioned, we’re going to be doing quite a lot of analytics to see how different participants treat their rewards, and let’s say there’s a scenario where those that are really committed to PRISM and are building up their AMPS, and if we see a certain pattern of behavior that that section a people who may be claiming and pledging versus people in the base pool, claiming and dumping, we kind of still have the optionality to be able to adjust that base pool and boost pool ratio going forward.
Farmer D Brown 6:47
Interesting. Thank you for that.
No worries. Any other questions while you’re up here?
Hey Ryan, can you take the host so I can start dragging people up here.
[chuckle] Even though there are less now…
Farmer D Brown 7:01
Do we have any new confirmed utility coming to pLUNA?
Ooh, what can we say? Yeah, okay, so one of the things that we’re working on is starting up our own protocol owned money market from Edge. So these are still early discussions, and obviously we haven’t announced anything so take what I mentioned with every grain of salt I guess, and things can change later on. So the idea is that we’re gonna have our own protocol owned money market from Edge. So right now we have Anchor, right, which is only accepting yield bearing proof-of-stake assets like bETH, and bLUNA. We have Mars coming up soon but it sounds like for now they’re only going to have a couple assets like LUNA and maybe… LUNA and UST to start. And then Edge have kind of come on the scene, and they’ve launched with a whole bunch of assets on their money market. So they’ve got LUNA, UST, aUST, ANC, LunaX, Mirror, a bunch of other assets. And as much as we wanted pLUNA to be in the genesis pool, a couple of things just didn’t line up and didn’t make sense. So instead, we’re kind of gunning for a Prism money market.
So inside this Prism money market, pLUNA will find it’s much needed utility where people can deposit pLUNA and use it as collateral to borrow other assets. So other assets that we’re thinking of dropping into the pool, or allowing users to deposit and borrow against is UST, aUST, LUNA, c, p, and yLUNA, perhaps PRISM and xPRISM as well. But yeah, so there’s pretty much all the assets that we currently support on the Prism Swap.
And it’s gonna open up a couple other interesting things too, because even though we initially started the conversations, just wanted to give pLUNA some additional utility that will allow people to borrow against it. C and yLUNA started to make a lot of sense too, right, because if you have cLUNA and you have unstaked yLUNA off of the protocol, it’s generating 10 times as much fees as it would if it was staked. So yeah, giving folks additional flexibility to use the c and yLUNA in whatever way they choose would be really nice on Edge, while still generating a ton of value back to xPRISM holders. And if you guys have used Edge at all, you’ll see that there’s like a spread between the interest rates, right. Maybe you’re supplying UST at 15%, but if you want to borrow UST, it’s at like 18%. So that spread is considered admin fees. And that admin fee is split between an insurance fund to help keep the money markets solvent, in the case that like there’s oracle failures or the value of the collateral is worth less than the amount of money that they owe. And then a portion of the fees are going to the Edge team for providing the service. And then a part of the split of the interest is going to go to xPRISM holders. So that’s kind of the few ideas that we had around pLUNA utility around the money markets’ side. And I was like a long tangent, but there’s some other other things too. But I’ll stop there in case you have any other questions.
Farmer D Brown 11:17
That’s awesome. Thank you.
Push Jimmy for more alpha, Farmer Brown. It’s only 24 of us in here.
I know. One of these days, Harry’s going to come up on these Spaces and…
I’ve invited him. Harry, there’s only 25 people here, come on, make your debut on Spaces.
Yeah, come on.
You’re talking about one of the top 50 most influential crypto Twitter accounts. And he’s never spoken.
I think top 30. Top 30? Top 35? I think it’s 35. [chuckle]
Come on, Harry. He’s not taking the bait. He’s not taking the bait. While we wait, and…
He says, “I’m on PC.”
He says what?
“I’m on PC.” I’m sure you have your phone nearby. But it’s okay, well let you off the hook this time.
If anyone else wants to jump up here and ask a question, please, please do. And in the meantime, Jimmy, do you wanna maybe try and give a… Should we do a bit of a Explain Like I’m 5 Prism Farm overview?
Yeah, sure. You wrote the article today, you want to start? And maybe I can… I was gonna write the appendix example, but time slipped away from me, but I’m happy to kind of go over that as well afterwards.
Damn, I was trying to put it on you. [chuckle] Okay, yeah, so Prism Farm is launching on Monday. It’s pretty good an opportunity for people to get a very attractive yield on their LUNA and ultimately, on their yLUNA. We got Petyr Bælish coming up here as well. On their yLUNA, we have 13% of the supply that’s available over the next 12 months for those that are participating in Prism Farm. And at a basic level, to come and participate you need some yLUNA, so you can either come direct to Prism and buy that on our AMM, or the more traditional route is bring some LUNA, split that into y and pLUNA, hold your pLUNA and put your yLUNA into the Prism Farm. Basically what’s going to be going on during Prism Farm is that you’re going to be exchanging the yields that is generated for yLUNA, and in exchange we are going to be distributing PRISM tokens every block proportionately between the people that are staking… Between the yLUNA that’s in the Prism Farm. So that’s at a basic, very basic level. And Jimmy can maybe go into some details in a minute on what sort of numbers of LUNA participating will mean various APRs. But to kind of…
This is Prism Protocol, so we can’t just make things super simple like that. But you can kind of think of it very similar to a Pylon pool, where you deposit UST, and in exchange for essentially the yield from your aUST you get tokens, in our example you’re exchanging LUNA yield for tokens. And then we split the pool into two pools. So there’s what we call the base pool, which is just going to be split proportionately between all the participants. And that’s going to be 80% of the tokens that are available. And then on top of the base pool, we then have what we’re calling the AMPS booster pool. So if anyone’s been paying attention, if you hold xPRISM, which is our liquid staked governance token, so staked PRISM, which is liquid and you can trade it, we call it xPRISM, you can put that xPRISM into… Or you can pledge it to what we call our AMPS vaut. So when you do that, you’ll start accruing AMPS, which you can sort of think of, it’s not a token, it’s more like a kind of loyalty points system. So based on the amount of xPRISM that you have put into the pool, and there’s a length of time that you have pledged it into the vault, you will accrue a certain amount of AMPS. And I guess there’s no lock up on entering this vault. But if you exit the vault, you essentially forfeit all your AMPS. And you would have to start from zero again. And then essentially… So the amount of AMPS that you have accrued, and the amount of yLUNA that you have in the farming event will essentially sort of determine your portion of this boosted pool, which is 20% of the total amount of tokens that are available. We essentially anticipate that for those people who have already been accruing AMPS, we say it’s definitely not too late to start accruing AMPS, because they don’t fully mature until you’ve been in AMPS vault for 200 days. So you’re starting now you’re going to be sort of eight or nine days behind those who started at the very beginning, we expect that the yield in PRISM tokens generated to those who are participating in that pool will be a very attractive APR on single sided LUNA staking. I think that’s in a nutshell. Jimmy, do you want to jump in and fill in any details?
Yeah, I’ll start with kinda like how I think things are gonna play out for the next 30 days or so. And then I can do some quick… Let me do the example first, I think the example will be a little bit quicker. So let’s just say that… Alright, I’ll just use the speakers that we have on stage, right. Let’s say we have Farmer, we have Petyr, we have You’re My Boy. Let’s just say for example, make it really simple, there’s only three people in all of Prism Protocol, and the three speakers that we have on stage are going to be entering into the Prism Farm on Monday. So let’s say they all have… Farmer, Petyr, You’re My Boy, you guys all have 100 yLUNA, and you all have 100 xPRISM that you guys have put into the AMPS vault. But let’s say Farmer D Brown, he just started right after this call. So he’s gonna accrue some AMPS. Let’s just say by Monday, he has about 100 AMPS that he’s accrued. But maybe Petyr and You’re My Boy, they started last week. And they’re a little bit ahead so the AMPS that they have accrued is 400 AMPS or so, right. So Farmer D Brown, 100 AMPS, Petyr, and You’re My Boy both have 400 AMPS, and they all have the same amount of yLUNA. So when the first set or the first block of PRISM tokens that they’re earning from the farm is released, let’s just say for a certain block there’s 100 PRISM tokens that are going to be up for rewards. So our formulas will essentially count how much yLUNA you have in the Prism Farm, it will count how much AMPS you have, and essentially gives you a weighted score. And for this particular example, the weighted score… I mean, not to get too deep into the math or anything like that, but it’s the square root of your yLUNA multiplied by your AMPS, right. And then the amount of tokens that you’re get in terms of boosts will just be your weighted proportion times the PRISM tokens for that particular block.
At the end of the launch article that we kind of announced today, I go through the exact numbers and how they’re derived. But for this example, you can assume or you can essentially intuitively guess that Farmer D Brown will receive the least amount of tokens. And then Petyr and You’re My Boy will receive more and an equal share of those tokens. And then, maybe sometime later Petyr thinks that, okay, he’s done farming or he has an emergency that comes up and he needs to unpledge his xPRISM, and he unpledges it and his AMPS goes to zero, right. So if his AMPS go to zero, then Farmer D Brown and You’re My Boy are left and their rewards are now increased because someone just left the boosted pool, right. So even though they didn’t… They didn’t even have to go buy more yLUNA, they didn’t have to go buy more xPRISM to get more AMPS, they didn’t have to do anything. It’s just the fact that if other people leave the AMPS vault, they benefit since they’re being you know… Yeah, it’s essentially non diluted for them. So that’s the quick example ofessentially how the boosted pool is gonna work, how AMPS works. And of course, the base rewards are just… The AMPS doesn’t really have anything to do with the base rewards, it’s just like a proportion of the yLUNA that you guys have.
Okay, so now let’s go real quick into what I think what’s going to happen within the next 30 days.
So I don’t know what the PRISM price is going to be when we start but if you guys have been kind of eyeing around or following the Prism Watcher, you’ll see that we have around half a million cLUNA that just got deposited into our vaults. I think it was today, earlier today. So for the next three days or so 100% of the staking yield from half a million cLUNA are going to go to xPRISM holders. So don’t know what the price of PRISM is going to be but all those buybacks are going to be happening for the next three days or so. So when this PRISM farm opens and if they’re still only around say 2 million… Yeah, let’s say around the roughly 2 million yLUNA in our current staking vault, if it all moves over to the Prism Farm and depending on how much yLUNA, how much xPRISM, how much AMPS and all that you have, there are going to be people who are experiencing triple digit aprs for staking yLUNA. And this will be the best yields on single sided staking yLUNA for a bit, it’s going to be the best. And as more people figure this out, either the price of yLUNA is going to jump up and arbitragers are gonna essentially keep it in check, or more people are just going to refract their LUNA and enter this Prism Farm.
And it won’t get into… I want to say, not until we reach around 10, perhaps 15 million LUNA, inside the Prism Farm will yields come down to something, I don’t know, more in line with market expectations, maybe 15% or something like that. So I’m anticipating roughly around maybe 5-7x the amount of LUNA jumping into our vaults. Otherwise, people are just going to get like crazy ridiculous yields on LUNA. So yeah, so they’re gonna start farming that and the yields are gonna come down. But then we have about 30 days, we have 30 days until the first PRISM tokens are gonna vest. That means, say we have 10, 15 million LUNA in our vaults now, and it’s all staked in the Prism Farm, that means we have 30 days of a ton of new LUNA, a ton of new fees for xPRISM holders, and no new PRISM tokens being emitted out into the world in 30 days. And I think this will give the broader ecosystem a taste of what’s possible with the type of yields and the amount of LUNA and the TVL we have in our vaults. And then they can decide, once their PRISM have vested, what they want to do. Are they going to claim and dump, like I’m sure many just plan to do to increase their LUNA stack? Or will they get pilled based on the price action and the amount of TVL that comes into our platform? And will they stake? And will they continue to pledge? Yeah, I think that’s how it’s gonna play out in the next 30 days or so.
And then beyond that, we mentioned it a little bit earlier today is that, if we see that more folks are just claiming and dumping versus holding, or staking, or pledging, then we have the ability to essentially redirect more rewards to the boost pool versus the base pool. And if we do that, it means that folks that do have xPRISM, do have AMPS, are gonna see way more returns than folks who just have yLUNA and aren’t holding any PRISM. Yeah, so that’s kind of my long spiel about what’s going to happen from starting on Monday, to maybe 30, 45 days out.
I think it’s interesting, Jimmy, because I run UK LUNAtics group and I think… There’s a good few hundred people in there, I think the general vibe that I’m getting is the people who are engaged with PRISM, are really engaged. And we saw that through the amount of PRISM that’s been staked, I think we’re at 71% of all PRISM is staked to the xPRISM now, we saw that through the amount that went into the AMPS vault very quickly. But then I think on the other side of that, we’ve got a lot of people in the community who are kind of looking at Prism, and it’s almost… It’s kind of a bit of a mental block, right. It’s really difficult, it’s confusing, I don’t get it. But I think it’s going to be very interesting when we start to see, as you say, potentially, up to triple digits, in terms of yield APR, in essentially lossless way, just staking yLUNA, I think that’s really going to get people’s attention. And and then we’ll start to see a real ramp up in terms of TVL under the LUNA vault, or as you say, otherwise those that are engaged are going to be extremely happy with how things are going. I see since we’ve been just running through a little bit of information about Prism Farm, I’ve got a couple of speakers up on stage. Petyr, welcome. Jump in with your question.
Petyr Bælish 28:36
Hey, how’s it going? I was in a Space earlier with Cephii and all, and you guys dropped a whole bunch of the stuff then. But my first one would be, do you have an ideal threshold in mind of where you’re going to move that lever of… Do you want it to kind of be stable 50:50, 50% dump, 50% repledge? My second comment would probably be, as far as AMPS go, I did see that you guys added some cool graph down below on the UI today, it would be kind of cool to see maybe some stats on how many amps are out total, and maybe a leaderboard of some sort. And I’m definitely looking forward to the dashboard. So I don’t know if you had any comments on when we could maybe expect to see that feature delivered. Because right now I think a lot of us are probably using something like Ape Board or something to view where all of our various positions are at at any given time. So thanks.
Yeah, I don’t think we have a set criteria or metrics that we’re eyeing to essentially move the lever. Yeah, it’s just something we’re kind of monitoring when the Prism Farm starts and when the token starts to vest, and we’ll kind of keep an ear out towards the community on Telegram and Discord to see what are some options. Perhaps in 30, 45 days, we’ll have the governance and polls up so we can perhaps even do a vote. We’re starting 80:20 now, but maybe in 60 days or so maybe we can put up some votes on what the loyal xPRISM and AMPS holders think what it should go to, should it go 70:30, 50:50? Maybe even more extreme, like 60:40 to boosted folks. So that’d be a little bit interesting and kind of let the community decide, I suppose. And then as far as the leaderboard, I really liked that idea, actually. There’s a lot of data that we kind of want to index, and we want to show in the dashboard. And it is a bit of a struggle to keep things nice and tidy, while also showing all the relevant stats that folks will care about, right. So we’ll figure out a way to show AMPS, average AMPS, or like some kind of leaderboard so you can see where you stand versus other people. I think that’d be really cool.
Petyr Bælish 31:24
Cool, thank you for your time.
I think there’s maybe just a question there about more… Yes, more visualization, good spot on the govern APR charts. We are hoping early next week that we’ll be able to launch the trading view charts on the swap pages, where you’ll be able to essentially track the price of any two assets against each other that are in Prism Swap. So I guess the much awaited various assets against UST, and charts as well as being able to map things like yLUNA against pLUNA, cLUNA against LUNA, things like that. So I’m very much hoping that that’ll be launched early next week alongside Farm. In terms of the dashboard and My Page, I think they’ll be kind of following in short order after the charts. Thanks for the question, Petyr. You’re My Boy, welcome to cozy Prism Spaces again. Hope you’re well, and jump in with any questions, ser.
You’re My Boy, $LUNA! 32:50
Doing great. Thanks, fellas, I had two Farm related questions for you. In your Medium post, there’s a reference to periodically needing to go to the staking page and bump a button in order to keep AMPS happening. What’s the story behind that?
It’s a fun story that Jimmy will get into the details for you.
[chuckle] Oh, man. Okay, so… Man, I wish… I’m also still studying it myself, having the devs kind of explain it to me. But the idea is that the amount of AMPS, because it’s not a token, it’s not as easily… I guess, your boosted rewards are not as easily calculated, because it’s not a simple token, right. It’s a number that exists on the blockchain somewhere. And your weights for the Prism Farm can only be updated every so often. Say if we had 10,000 users inside the Prism Farm, the amount of calculations that need to happen to trigger the weights, calculate each individual users weights, and the average weights, and do all those calculations, it’s too gas intensive. So periodically, if you have a major change in your weight, say you just deposited a bunch of yLUNA, or let’s say you pledged a bunch of xPRISM, you probably want to go and activate those rewards. And on the UI, we’re making it really simple to say, oh, how much of your AMPS are being applied to the Prism Farm, and how much of your AMPS are just idle doing nothing. So occasionally, you’ll want to go in and apply the AMPS and apply your boosts to the Prism Farm. So that’s kind of the gist of it.
You’re My Boy, $LUNA! 35:19
So do our AMPS linearly lessen, like the 0.5 per day if you’re not hitting that button, or just one day, you just stop getting the AMPS boost?
So they’re separate but related things, right. So the AMPS, they’re always increasing by 0.5 per day, until you reach the max at 200 days, I think it’s a max of 100 AMPS and you’ve reached the maximum, so that increases linearly. But for the Prism Farm, the way that your AMPS are combined with your yLUNA, that you’re staking, there’s a curve to it, right. Then that Curve is to encourage new users to come in without feeling… I guess, overwhelmed by like, “There’s so many incumbents already, I’ll never catch up,” right. So the cap helps with that, right. The cap of AMPS helps with that. And the curve also kind of helps with that as well. So in about half the time, you’ll reach 70% of whoever has been, I guess, AMPing the longest, in about half of their time you’ll reach up to 70% of their rewards. And the way that the math just kind of shakes out that the AMPS is not being applied all the time to the Prism Form. So every occasionally you’ll go in to essentially apply the AMPS you’ve accrued to the Prism Farm. So they’re related but separate things.
You’re My Boy, $LUNA! 37:12
Yeah, I think the TL;DR on having to go and hit the button is it’s a technical challenge to be able to constantly update every participant’s AMPS every block to kind of accurately reflect their position, their weighted position in the pool. So unfortunately, it’s not the most elegant solution, but the solution is, you have to go and hit the button every now and again to update your AMPS individually.
You’re My Boy, $LUNA! 37:46
Got it. One last question for me. So on day 201, when our AMPS are no longer AMPing, is there going to be some sort of defibrillator button that we can hit, or some equivalent of just unpledging and repledging again with the same xPRISM to restart the AMP effect.
So you wouldn’t have to do that. You’ll just reach the maximum amount of AMPS, you’ll reached the max capacity. So at that point, you’re highly incentivized to not do anything because you’re gonna lose essentially 200 days worth of progress, right, seven months or so worth of progress. The only way to get additional AMPS is to pledge more xPRISM. But if you decide to unpledge any xPRISM, even if it’s just one or half of one, all of it resets to zero. Yeah, so if you’ve already…
You’re My Boy, $LUNA! 38:59
All of the gains that you had already accrued, you’re saying?
Yes, yeah, so essentially…
Not the gains. It’s just the AMPS, just the amps.
You’re My Boy, $LUNA! 39:08
Roger, okay. So it’s not a moving forward thing. It’s literally, once you’ve pledged all the AMPS you’re accruing, basically, you need to exit the 365 days of the Farm in order to actually retain all the AMPS related tokens you farmed.
No, no, I think maybe a slight misunderstanding here. So I think each individual xPRISM can reach a maximum of 100 AMPS. And that takes 200 days from when you pledged it to reaching full maturity. So at day 201, the xPRISM that you pledged on day one would stop accruing AMPS. However, if you had pledged additional xPRISM in between day 0 and day 200, that would still keep maturing and keep accruing AMPS beyond day 200, right. So if you added some on day 30, so let’s say when your first farming rewards come in, and you claim and pledge those, you’ll then still keep accruing AMPS on those xPRISM for another additional 30 days, and so on and so forth. Anything that you farm, any PRISM tokens that you farm in the Prism Farm event, whether that be from the base pool or from the boosted pool, as soon as you farmed them, they’re yours, right, well the vest in 30 days, but they are yours and we’ll never take those back. So if you did decide to exit day 100, Jimmy gave an example earlier, day 100, if you have to go and do something with your xPRISM, maybe you have to save yourself from being liquidated on Anchor or something, I don’t know, whatever you need to do, if you started unpledging some xPRISM from the AMPS vault, you would lose all your AMPS, but you wouldn’t lose any of the PRISM rewards that you had farmed up until that point. The only thing that would happen is that your AMPS would reset to zero.
In terms of AMPS functionality, so obviously, the only functionality that they’re going to have initially will be to boost your yield in this Prism Farm event. However, we do hope to be able to bring sort of AMPing into other aspects of the protocol. So for example, when we launched governance, we hope that xPRISM holders who have accrued AMPS would get some sort of governance boost sort of in a similar way. Essentially, think of it in a way as the… If you’re familiar with sort of ve tokens, where you lock up a token for a certain amount of time. And as a result, you get an extra governance boost. We’re essentially doing that with AMPS. But instead of having them locked in the vault, they just accrue additional voting power over time. And then they lose that voting power should you remove them from the AMPS vault. Does that help clarify a little bit?
You’re My Boy, $LUNA! 42:38
Yeah, that helps. I got a little scared there for a moment about the whole potentially losing it for whatever reason, you withdrew it. I don’t think the… It may be intentional, I don’t think the medium articles really speak to what happens post day 201, or at least not that I found.
Okay. No, that’s good feedback, and we’ll look into that. And I guess the other thing to mention about in terms of flexibility. So I think the really interesting thing about Prism Farm and farming with yLUNA, and we hope that going forwards once we’ve launched this, other projects will maybe want to do yLUNA farming for their tokens as well. The mechanism that we’re utilizing is that it’s completely flexible in terms of your yLUNA participation. So you can enter on day one, on day five you can pull your yLUNA out, do something with it if you want to, drop it back into the pool on day 10, you can dip in and out of the farming event with your yLUNA at will, that won’t affect anything else on the platform. You’ll still get the PRISM that you farmed while your yLUNA was in the farm, it won’t affect your AMPS that you’ve accrued, so there’s a lot of flexibility there ersus let’s say a Pylon Pool, for example, where you’re typically locked up for either 6, 12, or 18 months. So it gives the participant a lot more flexibility in terms of being able to kind of dip in and dip out should they wish to participate.
You’re My Boy, $LUNA! 44:33
Great, last one for me if it’s cool, on Discord there was some alpha hinted at there would be an auto claim and repledge feature at some point. Do you see that being available at Farm launch or at some interval after you go live?
So for auto claiming. I think that if we decide to implement that, that’ll come a little bit later. But for when you’re going into manually claim your vested PRISM tokens, you have the option to just claim naked PRISM tokens, or we can automate the next steps, which is claiming PRISM and staking them for xPRISM, and then we can also take it one step further, where it automatically claims, stakes, and pledges your PRISM to xPRISM into the AMPS vault. So not quite, totally automated where it’s set it and forget it. But we can make some of the more usual actions a little bit more convenient for you.
You’re My Boy, $LUNA! 45:50
Great, great feature. Thanks, fellas.
Thank you, sir.
It’s a quiet Friday night tonight, Jimmy.
Yeah, indeed. There’s only like…
I was just looking at the invite list to see that you’ve basically invited everyone in the Spaces to speak. But no one wants to come and ask us a question. Have we got anything else that we kind of want to drop while we’re here?
Let’s think. Yeah…
Farmer D Brown 46:22
I’ve got a prediction.
Yeah, go for it.
Farmer D Brown 46:26
So my prediction is that, when the farming event opens up and people realize the yield that they can get, they’re going to dump all of their pLUNA, and it’s probably going to go down to about 10% of the value of LUNA, at which point yLUNA is probably overvalued, because over time the yield that you’re going to be able to get is going to decline on two levels, the staking rewards of LUNA are going to go down as LUNA goes up, and the yield eventually that you can get through farming is going to go down as people lock more of their LUNA into the protocol. So there should be a bull market in pLUNA, if… I can’t see it going below 10% of the value of LUNA…
That’s definitely… You’re breaking up a little bit Farmer Brown, but I think we got the gist of… You’re essentially predicting a dump of pLUNA, a price rise of yLUNA. And then at some point in the future, maybe after the farming event’s finished, or maybe during, and there’ll be kind of like a run up on pLUNA, which I think is an interesting prediction, and I’ll be keeping an eye out for that. I think something interesting that we’ve really been… Well, firstly, like if I was refracting now, I’m not sure exactly what the ratio is here. But the ratio of to me, and I’m going to be refracting a little bit more is not… I think it’s a really big risk at this ratio to just dump pLUNA into yLUNA because you’re getting… I don’t know, maybe 20% more yLUNA, but it’s a big risk for that 20% to potentially dilute your LUNA stake if pLUNA does decide to go on a run and you get stuck on the wrong side of that ratio. Personally, I’m very cautious, I’ve kept 50:50 Because I always want to be able to go back to my original LUNA stack.
But we’ve definitely been having some interesting conversations at a protocol level, and maybe some… Again, something that’s going to be potentially interesting when we open up governance is if pLUNA gets down to a certain price or maybe a certain ratio or percentage, do us as a protocol want to start buying up pLUNA utilizing the Treasury, to essentially lock LUNA into the protocol in perpetuity? Because even if yLUNA goes to 99% of LUNA price, you still need one pLUNA for every one yLUNA to be able to unlock that into native LUNA. Of course you can go out via UST potentially, you could swap into LUNA via the AMM. But you need equal parts yLUNA and pLUNA to actually pull the staked LUNA out of the protocol. So that’s a really interesting idea. And then you could potentially take that one step forward. So you could say, “Well, what other parties might be interested in ensuring that LUNA is locked in staking in perpetuity?” Would the Terra community pool be interested in potentially buying up some pLUNA and ensuring that LUNA is locked in perpetuity? I don’t know. Would TFL be interested? I don’t know. But it’s definitely a potential play.
And then also once we route the… Let’s say Jimmy’s prediction’s right and we ended up with kind of a good chunk of LUNA TVL into the protocol, and kind of approaching that, let’s say 15, 20 million at some point in the future. And then we’re also working hopefully in the not too distant future, having proxy governance rights attached to pLUNA for the Terra network. At what point does it become attractive for someone who’s interested in passing a particular proposal to come in to Prism, and instead of buying up governance rights at whatever the price of LUNA is, buying governance rights at whatever the price of pLUNA is? So that could be really interesting as well.
You’re My Boy.
You’re My Boy, $LUNA! 51:29
Yeah. I’m just curious, slightly different topic. But when you all start refracting new tokens, is the plan to always issue the perpetual… Do the perpetual refraction first, and then the fixed term after that? Can we expect that to be sort of the formula for newly refracted tokens?
Good question. I would say not necessarily. I mean, there’s the problem with… So a lot of people said, “Oh, well, perpetual is whatever. And maturities are much more interesting.” I think they’re very different products, first and foremost. I think the maturities market is probably going to be a lot more boring, it’s probably going to be more people kind of selling their future yield to finance something in particular, knowing that they’re going to get their full token back after whatever maturity length it is. The problem with maturities is, how do we create a market to essentially facilitate trading of maturities, right. Because there might be a lot of interest in providing liquidity for like 12 month yLUNA, against PRISM or against whatever. But given that yLUNA is essentially trending towards being worth zero, how do we facilitate that from a kind of orders and liquidity perspective? Because I don’t know who would want to be the guy that’s providing liquidity for yLUNA that’s got maybe half a month left of yield for it. I think Jimmy’s probably got some big brain imajin ideas that you might want to throw in there.
So if you’re here from the beginning, I mentioned that I read the Sigma white paper. In there, they said their options are going to be run on a native order book on the Terra ecosystem. So that is certainly an alpha leak. And this will essentially enable us to have what you just mentioned, like not being able to sell these maturing assets, not in an AMM where you’re 100% get rekt on the yield bearing token side, but you will essentially just be able to sell it for whatever the market is willing to buy it from you for. So if you’re setting up these limit orders or… Yeah, being able to set up these limit orders on this order book, then you won’t receive any kind of impermanent loss on these maturing assets. So I think that’ll be really cool if we can somehow find a way to collaborate on that, or somehow they can list our assets, that’d be really cool. And then there’s a couple other protocols that I know of that are also creating an order book model. And finally, the other option is to have almost an LBP pool for these maturing assets. If you guys are familiar with LBPs, you know that the prices are always going down for the pool, because the weights are changing in the pool, right. So we could potentially set the schedule in which the weights are changing for an LBP such that it equals zero, right around the time that the asset is maturing. So it allows you to trade it on an AMM-esque style pool, but for maturing assets where you won’t get rekt if you’re LPing for it. So I think that’ll be really interesting. But personally, I’m leaning towards the order book model, I think that’d be really cool. And seems like a bit simpler to piggyback off of other people’s infrastructure.
You’re My Boy, $LUNA! 56:19
That’s awesome. For me what’s so crazy and interesting about your protocol, and what makes it so sticky is just the seemingly infinite number of ways to apply these different refracted assets, these use cases that don’t exist yet, but you could see that we’re only a step or so away from being able to do it, to partner with some of these other protocols that are here, and some that are coming. It’s like the options seem almost unlimited. I guess, one just last piece of feedback, I think what could really continue the momentum in a ecosystem that just got so much going on is kind of keeping the pipeline flowing for newly refracted assets. So do you have any sense of… Is every month to six weeks, is that a reasonable timeline for new assets, whether it’s the fixed term or a new token? I’d imagine, maybe the answer is it depends on kind of what these tokens are, but do you all have the development horsepower to have new products deploy on a less than kind of an every two month kind of a rhythm. Is that possible?
Yeah, I think it’s difficult first to commit to specific timelines of release. But what I will say is that we do have more things lined up, ready to go, once we’ve got through this initial phase. Now unfortunately, kind of obviously, we made some tweaks to the Farm along the way by introducing AMPS and so we’ve just had to make some tweaks before we launch Farm. But I think that the tweaks that we have made are actually going to be extremely beneficial to the protocol. So I think it was definitely the right thing to do in the situation. But once we’re over the other side of Farm, and as I say, we hope… There’s three things that we haven’t launched yet in the first one that we want to get going. One is farm, one is charts, and then the other is the limit order functionality that I’m sure you’ve heard us talk about before. Once we’re over the other side of that, which hopefully will be kind of concluded in the next couple of weeks, we have contracts ready to go pretty much for Astroport LP tokens and the refraction of those. And we also have contracts written for bAsset refraction. So we’ll be able to go with bETH, and then hopefully, kind of with all the action that’s been going on Anchor, you have to presume that they’re not too far away from being able to add additional collateral assets as bAssets onto Anchor. So hoping that bSOL and bATOM aren’t to far behind. And then I guess we just need to… And then the other thing on top of that is getting maturities out there, which again, I think the code’s written for but it’s just coming up with the liquidity solution. So we’ve got lots of things that are going to be shipping over the coming months, and we certainly intend on having a fairly detailed roadmap In terms of where we go after that, and we’re certainly open as well to community feedback in terms of what you want to see on there.
Yeah, and I’ll just say one thing before I gotta go Ryan, to… Yeah, some family members just came in town and we’re supposed to go eat 10 minutes ago. But [chuckle] yeah, so just to reiterate, we have a bunch of stuff that’s already written and almost ready to go. And then afterwards, yeah, we’re definitely open to hearing what the community kind of wants. And as things play out, we can iterate and kind of change course where needed. But at the same time, we’re looking to onboard new devs so we can keep up with this cadence, right. So I would say for the next couple of months, that we’re just going to be pumping out new features that are already say, 85%, 95% complete that just needs to get polished up and ready to go. But along the way, we want to also continue to build and get new contracts audited by Vinnie, the guys over at Terra SCV, as well as some of our other auditing partners as well, so we can keep up with it. So if you guys know anyone, you can DM us and we’ll definitely give them a shot. But well, that’s it. I gotta go. As much as I’d like to hang out, I’m already late and people are already mad at me.
Thanks, Jimmy. I see we’ve got some more questions here. So I’ll hang around and answer more questions. And yeah, thanks, Jimmy, catch you soon. Have a good evening. And I’ll caveat, me hanging on here and answering questions, I’m the operations guy, not the technical guy or the guy with the financial background so bear with me. Farmer Brown, you had your hand up. Did you want to come in with something on what we were talking about there?
Farmer D Brown 1:02:16
Yeah, so just on the topic of refracting other assets, at what point on the roadmap do you picture doing non-Terra and non-bAssets? And would that occur as wrapped assets on the Terra blockchain, or would that occur on other chains?
That’s a great question. And I don’t know if I have a full answer to that myself. And obviously, in terms of where would it be on the roadmap, you’re talking at least a few months down the line, because we’ve got all the stuff to ship that I just talked about. But I think if you think about it, if we’re going to be refracting other yield bearing assets, we would have to stake those assets with validators natively on other chains. So how exactly that gets worked out, I don’t know. It feels like bringing in wrapped assets and then taking them back out and staking them. I’m not sure if that’s going to be the most efficient way of doing things or whether we would need to kind of spin up Prism on other chains. I think that’s about as much as I can give on that.
Farmer D Brown 1:03:42
Okay, thank you for that.
No worries. I think 0xn00b was next up. I see you’ve got your hand up there Messi, and I’ll come to you after.
Hi, guys. Thanks for this Space. Yeah, I’m really happy about the protocol. I think it’s a great product. And at the moment, I’m mostly just the xPRISM guy. I’m [chuckle] too scared to… I mean, I can refract LUNA of course, but to trade between yLUNA and pLUNA at the moment, I mean, yeah. This is one question… I mean, you have answered most of the questions that… Do hear me?
Yeah I’ve got you, man.
You have answered most of the questions that I had in the meantime, and thanks for sharing… I think it was Jimmy sharing this train of thoughts about what will happen, it’s really helpful to understand the protocol at all, I mean, since it’s not straightforward at all. But what I had… I mean, it’s not a concern but it’s something that I was thinking about is the current situation with the ratio between the pLUNA and yLUNA. I mean, I’m just afraid of doing any kind of trading between them, because I have feeling that the market would just trapped me, because this ratio… I mean, of course, the market will always decide what it is, but it seems a bit disbalanced. And at the moment, I don’t see any benefit of why would I trade between them, why would I sell my pLUNA for yLUNA instead of just holding yLUNA. But at the end of the day, isn’t that the same as if I would hold just LUNA? And yeah, the question on top of that would be… Because I was thinking would it be possible… So let’s say that I have 100 LUNA, right. And if I was at the beginning, when the ratio was 50:50, I would trade all of it into, for example, yLUNA and I would earn double APR on my LUNA, right. But let’s say that in the time, this ratio becomes much more favorable in terms for yLUNA, as it is now, and wouldn’t be profitable for me, at the moment for example, to sell my yLUNA to earn more rewards or not rewards, but to earn more LUNA in total, because this ratio, I think it’s really disbalanced, and it would be good to have some kind of tool which would give you an optimal ratio between them so that… I mean, I know that the market is always right, but this doesn’t look like a proper ratio between them. So did you guys as a team have any thoughts on this kind of things?
Gosh, there’s a few things to unpack there. So I think obviously it depends on your risk appetite, right. So you mentioned… Well, my personal strategy is I refracted some LUNA, and I’m just holding equal parts p and y, knowing that I can always go back to my original stack of LUNA. You then said kind of like, “Well, what’s the difference than me just staking LUNA?” I think that’s a fair point other than the fact that I think at a very basic level, you could look at Prism as a liquid staking platform, right. So yLUNA essentially like a liquid staking derivative, or y plus pLUNA is like a liquid staking derivative of LUNA, so if you’re just staking native LUNA, you’ve obviously got a 21 day lockup, whereas with Prism Protocol if for whatever reason you need to get out of your position real quick, and you have the optionality to be able to do that. And then we’re here, we’re talking about Prism Farm earlier. I think staking yLUNA in Prism Farm, even if you consider just holding your pLUNA and you’re just saying, “Well, it’s the same as holding and just staking LUNA,” I think staking yLUNA in Prism Farm is going to give the best yield for single sided staking of LUNA across the entire ecosystem. I did some some analysis the other day and I think I also saw a bot pop up on Twitter that’s kind of giving the APRs of the various forms of LUNA, whether that be just native staking LUNA, bLUNA, nLUNA, obviously, it’s kind of similar because you’re getting paid out in Psi token, and in the yLUNA Farm, you’re gonna get paid out in PRISM token, but they’re all kind of trending between that 10% and 15% mark.
Just one thing, Jimmy mentioned that if during the farming event, a lot of LUNA or yLUNA is being moved to a pool for the farming, then the APR for yLUNA would go triple digit. Why is that the case? I don’t see why would that happen? Doesn’t the APR depend only on, yeah, the amount of yLUNA that you have and the native yield that LUNA is giving you?
So the Prism Farm event is farming PRISM tokens. So you’re getting paid out in PRISM tokens. And so there are multiple variables that will determine the APR. And if you actually go to Jimmy’s profile, I think it’s also in the Medium article that we put out today. There’s a link to a calculator that Jimmy put together. And you can pop into there a number of variables, I think, the PRISM price, the amount of yLUNA that’s going to be in Prism Farm, the amount of yLUNA that you’re staking, there’s a bunch of variables. So if you go in there and kind of make your own assumptions in terms of the various variables, it’s going to spit out a kind of estimated APR based on those variables. And you can make your own assumptions. I think we’ve seen various people who’ve used that calculator. And they’re basing it on kind of the amount of LUNA that’s currently in the protocol, which is about 2.5 million. And the amount that’s in native staking, which is about 1.6 million. And even if the kind of… If you presume that PRISM price is going to stay around where it is, maybe up a little bit, or maybe even down a little bit, and all that 1.6 million moves into the PRISM Farm from day one, I think the APRs are going to be pretty crazy. Because I think Jimmy’s estimation is that you need to get to about 10 million yLUNA in the Prism Farm, before you start to come close to that sort of 10% to 15% APR, that maybe it makes more sense to just get native LUNA rewards. Does that make sense?
Yes, thanks. Yeah.
Cool, and in terms of where p and y are trading against each other, I mean, obviously, people have got fairly strong opinions on this. And obviously, a perpetual market is obviously very different to a fixed maturities market where ultimately the p token will become whole at the end of the maturity level. This is a perpetual split. And I think at launch here, we’ve obviously got relatively little functionality for pLUNA. So there’s three things you can do with pLUNA, right now you can hold it, you can trade it, or you can LP it, right. But some of the things that we were talking about here, so I think Jimmy was talking about protocol owned money market that we’re hoping to open up on Edge, which will give optionality to pLUNA to be able to deposit pLUNA and borrow against it. And I think that’ll be quite a powerful bit of functionality for pLUNA, because I think there’ll be a lot of people just holding pLUNA in their wallet, they’re wanting to do something, wanting to try and earn some yield on it. And when that functionality opens to be able to borrow against it, and or to deposit and let others borrow against it. I think that’s going to be a really interesting piece of functionality. And then obviously, we’re talking to other money markets and other protocols that are launching that could also have functionality for pLUNA.
And then we were also just talking there about… I think you were listening in, about once the governance throughput rights, that allow you to vote on Terra governance proposals, once we get to a certain TVL of LUNA, that maybe becomes really attractive for someone to come in and buy up the governance rights, and/or if it comes down to a really, really low level, it then makes sense for either the protocol itself, or other interested parties who would be interested in ensuring that LUNA is locked in staking in perpetuity to come and buy a bag of pLUNA. So I think there’s lots of interesting things to pLUNA. Yeah, it’s kind of launched and the people have gone heavily onto the y side. But I don’t think that the game is over yet. And we’ll see. We’ll see what happens. But as you say, ultimately, we had no idea where this was going to go. We had some ideas, we seeded the pool at 50:50. And we let the market decide. And obviously, they’ve taken their position for now, and we’ll see what happens.
Thanks a lot. I mean, yes. As you said, market is gonna decide, right? It’s that… I had one point, I lost my thought, but yeah, thanks a lot, man. I mean, it’s an amazing product. And I’m really looking forward to using it. It seems like something quite unique.
Thanks, man. Appreciate it. And yeah, we were just talking before with You’re My Boy about… He was asking what other assets might we refract. And we were just also talking there about pLUNA… I have seen some people say, “Is pLUNA actually… Is it gLUNA, because it’s ultimately going to retain the governance rights? And is that how we’re valuing pLUNA? Are we valuing it against the governance rights?” And in a really interesting conversation with Hyperion earlier, we’re talking about Anchor and obviously, the crazy price action that’s been going on on Anchor and what’s behind it, are we lining up for some sort of governance wars on Anchor, I think there’s been a proposal that’s come forward about reducing yield unless you own a certain percentage of Anchor. Are we going to get into this kind of Curve, Convex type situation where governance rights on Anchor actually start to become really valuable? And we were talking about what if we refracted perpetual Anchor, right, so Anchor tokens got a similar… Right now, a similar kind of single staking in APR as LUNA at about 9%, 10%. But actually, would governance for Anchor right now actually be trading at a premium to the yield, given the kind of activity that seems to be going on there? So that could be really interesting from a governance price perspective. Farmer Brown, jump in. Mr. Brown, did you want to jump in there?
Farmer D Brown 1:18:07
Yeah, sure. So I think potentially a way to price yLUNA is by looking at it as a less useful version of LUNA that isn’t necessarily pinned to the price movements, and offers you a slightly higher yield, which is essentially a risk premium. So if at the moment, it’s trading at 85% of the LUNA price, then you’re only getting a small premium on the yield, which you can get from it. So we’ve got to ask ourselves, at what point does it no longer make sense to take… How much additional yield do we need for the loss in functionality? Which is why I think once it gets down to… Or if it gets down to… Or if yLUNA gets up to 90% of the value of LUNA, it just starts to not make sense anymore, because you’re only getting a tiny, tiny little bit of extra yield from quite a large loss of functionality and increase in risk.
Yeah, no. Yeah, I completely agree. I think I said earlier, if I was refracting now, I think the… I certainly wouldn’t be switching over at this ratio. I think it is a lot of risk. And as you say… And we’ll have I think Monday we’re going to have an APR chart on xPRISM now and I think we’re gonna have a similar one up for yLUNA on Monday. And yeah, exactly what you’re saying there. I think, at what point does that extra sort of half a percent in yields actually makes sense to keep going with. And interesting from… I think, yeah, 0xn00b who just came and asked the question there about, “I’m too scared to trade between the two.” I think one thing I’ve been doing personally he’s just jumping in, if I see a dip in the market like we see now, and see pLUNA at like $15.50 dollars right now, I’ve been just trading that with either PRISM tokens or UST. So buying up some PRISM and trading it as if it was an old coin in itself, rather than kind of risking going between the ratios, actually just trading that as a token on its own. So that’s another way of interacting potentially. Right, I don’t think we have any more questions. I don’t think anyone else has asked to speak. Appreciate the guys who’ve jumped up and ask some questions. And thank you, Mr. TerraSpaces, I saw you were in here pretty quickly. So hopefully some of the alpha that we dropped here will be caught by other people. We are doing a Spaces with Orbital Command on Sunday. And so if anything kind of comes up between now and then, you can either save it for then, Hyperion will be there and be able to give maybe some more nuanced takes. And in the meantime, obviously chat us on Twitter, or jump into Telegram or Discord if you’ve got any questions, whether it be on Farm or anything else. So thanks.
Thanks for checking out another episode of The Ether. That was Prism Farm, Live on Monday, All Questions Welcome. Fecorded on Friday, March 4th 2022. This episode of The Ether was brought to you by Orbital Command, a community validator on Terra dedicated to educating, expanding, and promoting the LUNAtic community. Visit OC’s What We Do page using the link in the show notes to take advantage of some of their other educational resources including weekly meetups to discuss Terra protocols, strategies, and concepts, the Terra Luna Intel Report on Telegram, and YouTube explainer videos on Terra concepts. You can also support their community efforts by considering them next time you’re delegating or redelegating your LUNA. Find out more at orbitalcommand.io. This episode of The Ether was also brought to you by Luart. Luart is the first gamified NFT platform built on the Terra network. Luart provides a seamless minting and trading experience all while earning you rewards just for being a user. Be sure to follow them on Twitter and join the community in the Discord server for the most up to date news and announcements regarding all the hot new NFT launches, platform upgrades, and new projects hitting the secondary marketplace. Are you ready to #PutYourHelmetOn and join the movement? Find out more luart.io. TerraSpaces appreciates the support from all our sponsors. For terraspaces.org, I’m Finn. Thanks for listening.