Get ready for LP Token staking on Oceanpoint.fi
Launch Date announcement
A major milestone was reached for Oceanpoint and the Blocksquare community in 2022, with the launch of Oceanpoint on February 22nd. The protocol connects Decentralized Finance (DeFi) to real estate through tokenization and is made up of Ethereum smart contracts that form an open-end DAO. This allows anyone to participate and earn by contributing to a decentralized protocol backed by the real estate economy, without legal restrictions. Oceanpoint is based on three pillars: Defi products, real estate tokenization, and community governance.
On the one-year anniversary, the community would like to extend a big thank you to all Oceanpoint participants for their support. The first followers play a crucial role in turning an individual idea into a leader in the field, which is exactly what the community is striving to achieve — to be a leader in real estate tokenization. The goal is to help property owners extract liquidity from their assets without the involvement of banks and to create a new alternative to the traditional real estate market with increased liquidity, transparency, and speed, while lowering barriers for both investors and property owners.
Who are the Oceanpoint participants?
— Founders: The team that created the Oceanpoint platform. They are compensated with a portion of the originally minted BST tokens.
— Blocksquare: The company that created the award-winning real estate tokenization protocol, a core component used by Oceanpoint.
— BST holders: Members of the Oceanpoint community that stake BST tokens will receive sBST in return and be able to cast votes on proposals and receive a share of Oceanpoint’s revenue.
— Pool participants: Pool participants are Oceanpoint’s core users, making them a critical part of the community from Day 1. They often hold BST tokens, but regardless they have an important voice in the community that is expressed through both their capital allocations and their participation in community conversations.
— Liquidity providers: Liquidity providers assist the Oceanpoint community by providing two-sided liquidity to a BST pair on the Uniswap platform.
It’s time — LP token staking is coming with v0.3
Oceanpoint is set to release version 0.3, with an official launch on Monday, 27th February 2023 at 9am CET. This release follows the successful launch of Governance and Asset pool, with properties worth over $50 million tokenized to date.
The main highlight of v0.3 is the introduction of liquidity pools, which will be deployed on popular DeFi protocols such as Uniswap, Balancer, Sushiswap, and 1inch, based on decisions made by the community through governance. The launch will start with Uniswap.
The liquidity pools are designed to be accessible, connecting the Oceanpoint UI with liquidity pools on other DeFi protocols to provide a user-friendly experience. Once introduced, anyone will be able to provide liquidity to the protocol and passively increase their holdings of BST.
What are LP tokens?
Liquidity provider tokens or LP tokens are tokens issued to liquidity providers on a decentralized exchange (DEX) that run on an automated market maker (AMM) protocol. Uniswap, Sushiswap and PancakeSwap are some examples of popular DEXs that distribute LP tokens to their liquidity providers. With the introduction of liquidity pools, Oceanpoint will enable users to directly interact with selected AMM protocols and stake their LP tokens to earn rewards.
What are Liquidity Pools — What is Liquidity Mining?
Liquidity mining is a method of incentivizing individuals to provide liquidity to decentralized finance (DeFi) protocols. The process rewards participants with tokens for adding funds to a liquidity pool, which can then be traded on an exchange. It has become an increasingly popular way for DeFi projects to attract and retain users, but it also poses certain risks and benefits that should be carefully considered.
Benefits of Liquidity Mining:
There are a few potential reasons why someone might choose to participate in liquidity mining/farming:
1. Increased Liquidity: Liquidity mining incentivizes participants to add funds to a liquidity pool, thereby increasing the overall liquidity of the DeFi protocol. This, in turn, makes it easier for users to trade and exchange assets, leading to more efficient and stable markets.
2. High Returns: Liquidity mining offers the potential for high returns on investment. As the liquidity pool grows, the value of the tokens that participants hold in the pool can increase, providing attractive returns for those who have staked their funds.
3. Accessibility: Liquidity mining offers a low barrier to entry, making it accessible to a wider range of individuals. Participants can start with a small investment, and as they become more familiar with the process, they can increase their stake.
4. Financial gains: One of the main reasons is the potential to earn high yields. Liquidity providers can earn rewards in the form of the platform’s native token, which can appreciate in value, leading to potential capital gains.
5. Support for a project: Another reason is to support a project or platform that a user believes in. By providing liquidity, users can help increase the stability and liquidity of a project’s token, and in return receive rewards in the form of LP tokens.
6. Diversification: Participating in liquidity farming can also be a way for investors to diversify their portfolios and gain exposure to new, emerging projects and tokens.
Risks of Liquidity Mining:
It is important to note that liquidity mining also involves certain risks, including:
1. Market Volatility: DeFi protocols, like all cryptocurrency markets, are subject to high levels of volatility. This can result in sudden drops in the value of the tokens that participants hold in the liquidity pool, leading to significant losses.
2. Liquidity Risk: Liquidity mining relies on the continued presence of other participants to provide liquidity. If participants withdraw their funds, it can lead to a drop in the overall liquidity of the protocol, causing price slippage and potentially making it harder for users to trade.
3. Regulatory Risks: DeFi protocols operate in a largely unregulated environment, which can expose participants to legal and regulatory risks. Some countries may consider DeFi protocols as illegal, making it important for participants to be aware of the legal implications of their actions.
As with any investment, it is important to understand the potential rewards and risks, and to make informed decisions accordingly.
Oceanpoint Liquidity Pool mechanics
Although the transaction of assets and the subsequent staking of Liquidity Provider tokens or LP tokens to earn BST functions seamlessly for an end user, we explain the process in 3 steps for ease of understanding.
Step 1: Deposit liquidity pool assets
Connect your wallet (e.g. MetaMask) holding both assets of the Liquidity pool e.g. BST:ETH. Make your deposit through the Oceanpoint web interface to move your assets to the selected Liquidity pool protocol e.g. Uniswap.
Step 2: Receive Liquidity Provider (LP) tokens representing the assets
When you initiate a deposit of assets to a liquidity pool on a third party exchange like Uniswap, the protocol will issue LP tokens in return to mark your position in the pool. Instead of simply holding them in your wallet, Oceanpoint enables users to stake them to earn extra rewards in BST.
Step 3: Stake your LP tokens to earn BST
Oceanpoint will deposit your received LP tokens into staking contract designed for LP staking. In return the user receives a “staked” version of the same LP token. As the Liquidity pool accrues more BST (liquidity mining, rewards, asset revenues), that staked LP token will grant more of the underlying asset. To exit the pool, simply send your staked LP tokens back and you will receive the underlying assets together with the accrued BST rewards. While your funds are in the pool, you are free to move your staked LP tokens to other wallets you control.
There are no fees to deposit to or withdraw from the Liquidity pool (beyond Ethereum gas fees). After a user deposits assets to a Liquidity pool, a 48 hour lock period disables withdrawals for the user. This security feature is designed to prevent front running reward distributions and promote long-term participation.
Do the new Liquidity Pools impact BST distribution structure?
The answer is YES.
With v0.3, when Liquidity pools are introduced, the BST:ETH liquidity pool deployed on Uniswap v2 will receive 50% of monthly BST rewards, while the Governance pool and Asset pool shall split 50/50 the remaining 50%. The split between pools shall from that point on be governed by the community through voting, however, the team encourages a split as depicted in the graphic below.
Now it’s time to get ready for launch!
We invite our community to join the whitelist channel in Discord. We created a private channel for LP token holders who provide early liquidity on Uniswap. Benefits of providing early liquidity is that there is a 0.3% fee for swapping tokens. This fee is split by liquidity providers proportional to their contribution to liquidity reserves. Early liquidity providers face low competition PLUS we decided to spin the Wheel of Fortune for each early LP token holder, where we allocated a total of 10000 BST for all participants. You will also receive first access to log your LP tokens into the staking pool when it opens, which allows you to earn the highest rewards. Win Win.