The crypto market has picked up volatility again. Seeing $BTC and $ETH swinging +- 5% in a day suddenly seems normal again, and activity in DeFi is slowly returning. People are starting to become bullish again, and many of us are mentally preparing for the next bull run (hopefully).
Today’s newsletter is a sponsored deep dive into Unstoppable DeFi which has the mission to build a decentralized, feature-complete alternative for centralized exchanges. They plan on doing this by launching a beautiful, intuitive UI & UX, integrated spot & margin trading, single-sided LPing, instant fiat on/offramp, and a mass-adoption-friendly wallet.
Their dex will launch very soon (Q2 2023), but you can already try out their beta here:
Also, they will launch their token $UND on Wednesday, March 29th, at 13:00 UTC.
What’s unique about their token launch is that it is a community-first launch, which means no VCs, no presale, no private round, no whitelist, and no huge insider allocations.
It is a descending price auction - the community decides fair valuation. Which means that everybody receives the same price.
Join the $UND Fair Launch on March 29th 13:00 UTC here:
Link to $UND token launch
Once the auction starts you:
1) Connect your wallet
2) Enter how much $ETH you want to commit
3) Commit
Done.
Easy as that.
I will also write more about the token in the main text below.
Unstoppable DeFi - On a mission to make centralized exchanges obsolete
Poor UI/UX, limited financial instruments, and tedious fiat on/off-ramp have traditionally limited DeFi to tech-savvy and hardcore users.
The ultimate goal of Unstoppable DeFi is to make the crypto and DeFi space more inclusive and accessible to individuals who have previously been excluded from these financial opportunities.
How will Unstoppable do that?
The first step is to build a decentralized, feature-complete alternative for centralized exchanges. This will be the foundation for everything.
The first focus is a margin trading exchange with:
High leverage, low slippage, low fees
Single-sided LPing without Impermanent loss
Real Yield for stakers.
Last but not least: great UX
Followed by:
A fiat-to-crypto instant on- & off-ramp to close the gap and make crypto usable in the real world. This, together with the dex will also enable 24/7 on-chain forex trading (and later any RWA through the same infrastructure)
A normie-friendly self-custodial wallet, reducing the barrier of entry, simplifying access, and enabling mass adoption. This will be done by using familiar web2 flows to sign up and sign transactions with FaceID. With the help of account abstraction, you would never have to worry about gas, transactions, blockchains, or any of the underlying infrastructure (unless you want to).
As of writing this article, the protocol is live on the Arbitrum testnet.
I tried it myself with a 15x long on $ETH. If you want to you can try the protocol with play money here.
Making DeFi products accessible to people outside web3
Unstoppable DeFi has 3 main products at its core to achieve this:
1. A feature-rich DEX
Built on a liquidity aggregator for best prices and deep liquidity.
Offers infrastructure for all order types, including leverage & advanced spot orders.
Single-sided LPing without IL
Supports FX with the help of protocol-issued stables.
This means that Unstoppable’s users can enjoy a beautiful and intuitive interface, as well as advanced order types such as limit order, stop loss, and take profit orders for all their spot trading needs.
Unstoppable is building on top of existing DeFi liquidity and seamlessly integrating with aggregators and liquidity on platforms like Uniswap, Sushiswap, and GMX, Unstoppable guarantees its users the best prices available in all of DeFi.
Unstoppable also provides a form of safe, under-collateralized borrowing to leverage up positions, made possible by liquidity providers (LPs) offering single-sided liquidity without ever being exposed to impermanent loss or taking on the other side of traders.
Testnet is now LIVE: https://dex-beta.unstoppable.ooo/
2. A fiat-to-crypto on/off-ramp bridge
Bridging to crypto is performed by minting a 1:1 backed stablecoin directly from the user's bank account.
Bridging back to bank/fiat by redeeming/burning the coins for fiat.
Supports multi-currency stablecoins and on-chain forex
The Unstoppable:Bridge will be the fundamental groundwork for being able to trade between crypto and fiat (on/off-ramp). This is important because if we want to onboard the masses to crypto we need to make it simpler. If you want to get into DeFi today you typically have to start by transferring money to Binance, then send it to Metamask (opening a Metamask and storing a 12-word password is easier said than done for normies). A fiat-to-crypto on/off-ramp bridge will solve this problem and construct an infrastructure enabling the direct minting of a 1:1 backed stablecoin from your personal or corporate bank account, which can also be redeemed back to your bank account in equal measure.
3. A UI/UX-focused, self-custodial wallet
Focus on intuitive and web2-like UI & UX
The V1 version will implement account abstraction
Provide easy access to DEX from the phone
Recovery options, notifications, inheritance, portfolio & tax management, etc to be introduced in future versions
The main objective of Unstoppable:Wallet is to provide a secure, user-friendly, self-custodial wallet with advanced features.
The aim is to create a wallet that is not only appealing to crypto natives but also reduces the entry barrier for newcomers and those curious about crypto.
The Unstoppable:Wallet will, when it’s fully launched, feature an application-independent smart contract wallet with advanced capabilities, such as multiple recovery options, multi-sign confirmation based on custom limits, time-locks, and notifications on sensitive actions, contract verifications and trusted contract lists, account inheritance, notifications and messaging, portfolio management, tax export, and more.
Tokenomics: Modal and Utility
Let’s move on, anon. It’s time to learn about the tokenomics of Unstoppable.
The tokenomics and token distribution goals are to ensure aligned incentives between the key stakeholders and produce positive-sum outcomes.
They have a dual token model: $UND & $eUND. Both can be staked for a share of 100% of trading fees.
And as mentioned in the intro, the ecosystem contributors will be rewarded with the token. Furthermore, predatory VCs, airdrop farmers or mercenary LPs are excluded by design.
Therefore $UND will only be distributed via the public sale tokens and the initially seeded DEX market liquidity. eUND (earned UND) tokens, while liquid and transferable, will not have any protocol-owned DEX liquidity seeded and can therefore not be dumped on the community. Unstoppable wants to give token holders maximum optionality though and has made the token fully transferable. It can be sold at any point OTC or on secondary markets.
In other words, $eUND has NO Uniswap liquidity, and $eUND can only be staked directly for cashflow or vested into $UND. Only public sale and DEX liquidity will start as $UND, incentives and all other allocations will start as $eUND.
The team, Advisor, and Partnership tokens will not vest for at least 12 months.
The maximum token supply is capped at 100 million. 30 million tokens will start as $UND (out of these 30 million, 20 million tokens will be sold in public sale, and the rest 10 million will be used for DEX liquidity). The rest 70 million out of the initial 100 million will be as $eUND.
The circulation supply of $UND can only increase by vesting $eUND over 12 months. As such, the inflation rate isn’t set in stone and will depend on how many eUND are vested and unlocked for $UND.
Use cases for $UND and $eUND
Staking: Users can stake their $UND or $eUND to receive a portion of the protocol fees and revenue.
Governance: The idea is to progressively decentralize the protocol. Initially, the core team will guide decisions in order to ensure speed. However, over time, on-chain governance will be implemented, and a DAO model will be established. This will allow token holders to decide the future of the protocol.
Future Use Cases: Certain ideas around fee rebates, potential collateral in a Masternode system, and others continue to be discussed.
Public sale details (Dutch auction token model)
As mentioned in the intro:
The public sale is scheduled for 29th March 2023. Importantly, this is the first sale, meaning there haven’t been any private rounds, no presale, no involvement on VCs, and no whitelists either.
Let’s discuss how the token sale works:
The token sale will follow a dutch auction model. So what exactly is a Dutch Auction, and why might it be the most effective way to hold a token sale in today’s crypto environment?
Given the constant comparison of the Tulip craze seen in the Netherlands in the late 1600s to the chaos seen at the top of any crypto bull market, it’s only fitting that the Dutch Auction actually came about as the result of Tulip Mania.
In this type of auction, instead of buyers purchasing an offering at a fixed price, the process allows anyone to bid their own chosen quantity and price they are willing to pay. Unlike traditional auctions, the price of the asset continues to fall until the winning bid is made.
It enables the token sale participants to essentially lock the maximum FDV at which they invest i.e. when they participate in the sale, the number of tokens that they buy and the price they choose determines the FDV – which is decided by the user (unlike in a capped or uncapped sale), and that becomes the maximum FDV now.
If all the tokens sell at that price, then everybody invests at that FDV. However, if all the tokens are unable to be sold, the dutch auction reduces the price to attract more investors. This also reduces the FDV. At the end of the sale, everyone enters at the lowest FDV.
This mechanism eliminates the need to wait or engage in some mental gymnastics. It doesn’t matter when an investor participates, either they’ll get the price they invested at or better.
Okay, but isn’t there a minimum amount that has to be invested?
Yes, it’s called soft cap. The team is raising to build a product. If there isn‘t enough money they won‘t be able to deliver the product and quality the community deserves.
The team has kept a soft cap at $5 million FDV. As 20% of the tokens i.e. 20 million out of 100 million, are being sold, this will allow them to raise ~666 ETH or approx. $1 million through the fundraiser at least.
This is the soft cap, or as is called for dutch auctions, a reserve price. Think of it as the bare minimum valuation. The goal is, of course, to list at a higher valuation.
So if the token is sold at the soft cap price the token price will be approx. $0.05.
Example:
The way a dutch auction works in practice is that there is an opening price, let’s say $0.50. Let’s say there are 100k tokens bought at this price (total price $50k). Now there are 19.9 million tokens left in the sale. Time goes by and there are no more bidders at $0.50. The price drops to $0.25, and people are starting to get interested. 9.9 million tokens are bought at $0.25, and there are now 10 million tokens left for sale. Then finally when the price drops to $0.20 the remaining 10 million tokens are sold.
Okay, so the great thing about a dutch auction for the buyers is that this means that all the 20 million tokens are sold at the last price (which was $0.20), so it doesn’t matter what price you originally bought it at. So the bidder that committed $50k at the beginning will receive 250k tokens since the price ended at $0.20, and not the 100k tokens that the investor originally planned.
A very chad & fair model if I can say it myself. The team has now raised $0.20 x 20 million tokens = $4m which is 4x the soft cap.
Btw, Unstoppable are building on Arbitrum and the token is also launching on Arbitrum and they’re raising in $ETH.
Conclusion
Poor UI/UX, limited financial instruments, and tedious fiat on/off-ramp have traditionally limited DeFi to tech-savvy and hardcore users.
The ultimate goal of Unstoppable DeFi is to make the crypto and DeFi space more inclusive and accessible to individuals who have previously been excluded from these financial opportunities.
I’m bullish on Unstoppable, I think what they are creating is needed in crypto. To onboard the next billion users in crypto and DeFi we need simple, understandable decentralized exchanges with wallets that make it easy for the customers to access the platform. Direct transfer from your bank and into the dex is also a great feature that will simplify things a lot.
A one-stop-shop for all your trading needs that is decentralized, permissionless, transparent, publicly verifiable, and open source. As you probably also understood I’m a big fan of the dutch token auction model, and that’s why I added an example to illustrate it.
Now mark the date and time in your calendar for the token sale, March 29th 13:00 UTC here.
All right. That’s it for now my friends.
See you next week!
Want To Sponsor This Newsletter? 🕴️
Send me a DM on Twitter: https://twitter.com/Route2FI or reply to this email. I have a sponsorship deck I can send you.
Join My Free Telegram Channel 🐸
I’ve launched a free Telegram channel where I share tweets, threads, articles, trades, blog posts, etc. that I find interesting within crypto.
Join it for free here: https://t.me/cryptogoodreads
https://github.com/users/1Crazymoney/projects/1?fullscreen=true
Should there be any disclaimers? Are you being rewarded for this coverage?