With our hackathon coming to a close and the release of the Alpha phase of our new products coming closer, we would like to share with our community some of our progress and decisions toward building a Multi-Chain DeFi Economy.
When we released our last community update, we had anticipated it being the last one before we celebrated the solution to the EXFI loans situation and the CAND peg. We had entered final testing of our technical solution and had an economic plan which had been audited and tested. We began Monday May 9, 2022 with the intention of implementing both fixes only to watch, transfixed, as the bottom fell out of the crypto market, dragging us all down with the collapse of UST.
Obviously, to some this was reminiscent of what has happened with CAND. However, the UST stablecoin system functions very differently from FLR Loans and CAND. We remain confident in the underlying security of the Liquity protocol and were heartened to see how well Liquity, and Liquity forks such as Yeti Finance, handled the extreme volatility and downward pressure on their stablecoins. The problems we have experienced with CAND are technical in nature and not an underlying vulnerability of the protocol. With that said, we have been making updates to the protocol to help it function more securely and with less volatility in the fast transaction, low fee, low liquidity environment we are using it in. When full functionality is restored, FLR Loans will be more secure than ever before. We will continue to improve the protocol as we learn and grow as a team and a community.
Unfortunately, we have had to take a step back from implementing the fix for loans. The extreme volatility in the market makes implementing our economic solution risky at best at this exact time. However, we are taking steps and introducing features which we believe will help stabilize EXFI and the system as a whole, allowing us to move forward once again. As always, we will keep building.
The EXFI airdrop on Songbird was an educational experience in both market and community reaction. As with all things, Songbird has taught us lessons that we will leverage to improve and perfect the experience of using FLR Finance on the Flare Network. With the approach of the proposed launch date for Flare, we have made some decisions with how we will handle the DFLR airdrop.
Before Songbird was announced, we had decided to perform the DFLR airdrop based on holdings of the FLR token. We will still honor this commitment, but we will expand the airdrop to include EXFI holders. The reason for this decision is two-fold. One, we believe it makes sense to give greater governance weight to those who are actively participating in FLR Finance product testing on Songbird. EXFI holders have a vested interest in the success of the platform and have shown a commitment to the community and what we are building. Two, dropping DFLR solely to FLR holders risks a repeat of the market behavior that led to the significant price crash of SGB post EXFI airdrop. It quickly became apparent there were a significant number of SGB holders who had bought and held SGB solely for the EXFI airdrop. This was not something we had anticipated, as we believed in the value of the Songbird Network and had expected other projects to quickly begin building on the network and bringing additional value. By reducing the DFLR airdrop percentage going to FLR token holders, we hope to reduce market volatility around the airdrop.
Accordingly, DFLR will be distributed in the following way:
- 40M DFLR/YFLR will be locked for APY staking rewards
- 20M DFLR/YFLR will be granted to the FLR Finance Foundation for governance usage
- 10M DFLR/YFLR will be granted to the FLR Finance Team with 12 month vesting
- 1M DFLR has already been paid out as FLR Finance Songbird rewards
- 9M DFLR will be airdropped to FLR holders
- 30M DFLR will be airdropped to EXFI holders
The 30M DFLR airdrop to EXFI holders will exclude the current Foundation and APY cloud EXFI holdings.
Another lesson learned was on the manner in which we performed the snapshot for the airdrop. After seeing the impact of that snapshot on the SGB market, we have decided to perform a random snapshot of FLR and EXFI holders after Flare Network launch. This snapshot will not be announced or publicized, and we will not be announcing when it is complete. We will announce the snapshot either when we announce the airdrop date, or after the airdrop has been concluded. We look forward to the resurgence of “Wen?” You all already know the answer.
EXFI Lockup Pools
Following a similar line of thinking, we will be introducing EXFI Lockup Farm Pools. These pools will feature boosted SFIN rewards, but will require the staker to lock their EXFI into the pool for a period of time. We are still working on the details of the lockup periods and reward rates, but we anticipate these pools being a rewarding place to HODL your EXFI as we work to launch Governance and the APY Cloud.
FLR Drops on Coston
FLR Drops is almost here! We are currently working to launch and test various elements of Drops on the Coston test network. We are hoping to open up the test platform for our community to beta test in the next few weeks. We expect the test period to last for 1–2 weeks. Assuming no significant issues are found, we will then be prepared to launch the MVP of FLR Drops on Songbird. The MVP will have limited functionality at launch, with the complete feature list to be added over time as testing is concluded for each feature. Much more information to come!
These details are subject to change