Houlangcoin | Another 10-fold currency, if you want to keep the stablecoin price from decoupling, can Pickle pickle work?
Today, a new DeFi farming project called PICKLE sour cucumber has attracted attention.
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It is understood that Pickle Finance was launched on September 11, focusing on stabilizing the price of stablecoins through automatic market making.
When the market is skyrocketing or plummeting, or when DeFi projects are hot, there is often a short-term imbalance between supply and demand of stablecoins in the market, resulting in deviations in the price and value of stablecoins. For example, the price of DAI, the stablecoin currently anchored to the U.S. dollar, has been inflated, reaching $1.03 per coin. At this time, unless it is a person who needs to use it urgently, I believe that they are unwilling to pay a 3% premium.
Therefore, Pickle hopes to solve the premium problem through liquidity mining.
On Pickle, there are four stablecoin trading pairs of ETH to DAI, USDC, USDT and sUSD, as well as ETH/PICKLE trading pairs. Miners only need to inject tokens into the corresponding fund pool to get PICKLE rewards.
Pickle adjusts the transaction volume of stablecoins by regulating the mining rewards of the fund pool, so that their prices tend to be stable.
As shown in the figure, the initial mining token incentive shares of the above-mentioned pools are determined by the amount of funds in Curve.fi’s stablecoins, and USDT is the most, accounting for up to 38%.
But let’s look at the current prices of Pickle’s stablecoins. USDC and USDT tend to be stable, while DAI and sUSD are in short supply, resulting in a premium, which means that injecting funds into the two pools will yield greater returns. In order to provide users with a smooth connection between different trading pairs, Pickle Swap also embeds related trading pairs of SushiSwap and Uniswap for users to use. Pickle Finance also supports users to conduct leveraged transactions and arbitrage between stablecoins through flash loans.
To facilitate adoption, Pickle's token distribution model sets early incentives.
“In the first two weeks of the project’s launch, there will be a 10x multiplier to reward early adopters of the Pickle protocol, which means that 10 PICKLEs will be distributed per block for two weeks.”
Two weeks later, the Pickle block incentive was restored to allocate 1 PICKLE per block, 50% of which was dedicated to the PICKLE/ETH pool, and the other four stablecoin/ETH pools shared the remaining 50%.
Pickle Finance is relatively decentralized as a whole, with no VC, no ICO, no pre-mining, and adopts "Quadratic Voting" for governance to prevent the concentration of power.
For example, the following two situations have the same voting power: 1. Whales cast 100 votes. 2. 10 ordinary people, each votes 1 vote. This voting mechanism is also advocated by V God. To vote, users need to pledge ETH/PICKLE UNIV2 LP tokens to the ETH/PICKLE pool on Pickle Finance.
However, it will take time to verify whether Pickle can "control" the price of stablecoins with the power of one coin.
