The DeFi industry has been churning out innovative products, one after another, at an amazing rate. This has propelled the crypto community in the right direction with economic designs that actually work.
But since most of the things done on this end are new, one can easily pass off all these innovations as just experimentation.
Bounce is unlike anything you’ve seen so far in the DeFi universe. You must be familiar with the idea of swapping crypto tokens on AMMs such as Uniswap. This is a great concept by which infinite liquidity is created for traders. Bounce, on the other hand, thrives in the opposite scenario of a limited supply of tokens or NFT’s so that these assets can be auctioned off.
From Fixed swap auctions to Dutch auctions with decreasing prices, and sealed-bid auctions where the price is hidden, read on to learn everything you need to get started with Bounce FInance.
What is Bounce.finance?
Bounce.finance is an auction platform that is completely decentralized in nature. The platform allows for liquidity mining and staking mechanisms. It also sports a decentralized governance mechanism.
One of the most important principles of Bounce is the scarcity of resources. Since the resources are limited, things get really competitive here. Seconds worth of delays in swaps could lead to you missing out on an important one.
Now, the idea of swapping or simply a “swap” came from one of the most popular AMMs, Uniswap. The difference between the platforms comes in when we talk about liquidity. While Uniswap aims at providing infinite liquidity for all participants, Bounce goes a different way. It provides users a limited supply of tokens and assets like NFTs to promote a competitive environment.
The assets can then be sold off in a number of different ways like token sales and NFT auctions.
If you aren’t absolutely new to the world of cryptocurrencies, you would’ve come across the term token sale. If not, don’t worry, I’ll tell you what it is.
It is a type of auction where there is a limited number of tokens that are available for sale. These tokens have different principles that define how the auction would take place. They also have time limits.
So, a fixed swap auction, for example, would have the tokens sold at a fixed price. A Dutch auction, on the other hand, would have a decreasing price.
NFT auctions are pretty similar to token sales with the main difference being that instead of tokens, NFTs are on sale. Another difference is the fact that NFT auctions sport a lower number of NFTs for sale compared to the number of tokens in token sales.
Bounce.finance works well with most of the crypto wallets you would find in the market. For best results, however, it is favorable to stick to MetaMask, Binance Chain wallet, WalletConnect, Coinbase Wallet, Ledger, or Trezor. Support for more wallets can be expected in the future.
The platform supports multi chain assets, so you can actually use your Ethereum and Binance Smart Chain assets on the platform without facing any problems.
What is the Polkadot & Kusama Parachain Crowdloan on Bounce.Finance?
The term Parachain is just another way of saying parallel blockchain. A Parachain is an individual blockchain (Layer 1) running in parallel with either the Polkadot ecosystem or the Kusama ecosystem. There is also a situation wherein the blockchain runs in parallel with both ecosystems.
When it is connected to the Relay Chain, Parachain teams can derive multiple benefits from it. This Relay Chain is the Layer 0 multi-chain network that sits at the heart of Polkadot. Through the Relay Chain, the teams can take advantage of its governance, interoperability, and security. Through that, a whole set of applications and use cases can be realized.
As of now, the number of Parachains that the Polkadot Relay Chain can support is highly limited. In fact, the maximum number is just 100. This poses quite an issue considering the fact that over 400 projects are currently being built on top of Kusama and Polkadot. The scarcity of Parachain slots makes the allocation to teams a difficult task.
Coming to the loan bit.
As already mentioned, securing a Parachain slot is difficult. A Parachain candidate has to acquire it by a type of auction that has an unknown ending time. It is called a non-permissioned candle auction, just in case you’re wondering.
Each Parachain slot out of the 100 available ends up being divided into four lease periods of 6 months each. The projects interested can then bid for single or multiple periods as per their needs and requirements.
Kusama is an experimental blockchain environment with real economic conditions. And for that reason, it is commonly referred to as the canary network of the Polkadot ecosystem.
The platform was the first chain to start the slot auctions on Parachain. Since then, the projects have kept coming. The idea was to connect a fresh batch of projects to Kusama as Parachains. And it was supposed to be done every 3-4 weeks with about 30 Parachains onboarded in the first year.
For participating in slot auctions, Parachain candidates have to choose a lease period or, if they decide to go for it, a combination of lease periods. There are, after all, four lease periods of six months each, so there’s plenty of room here. Once done, the candidates would then stake a number of KSM or DOT tokens.
A complex and innovative mechanism involving the lease period combinations and the highest number of KSM or DOT tokens staked then picks up winners of the slot auctions.
Now, a candidate can stake the DOT or KSM tokens they have. They can also incentivize community members to go ahead and lock their DOT or KSM tokens as well through crowdloans.
The community members who take part in the crowdloan of projects lock their tokens for 6, 12, 18, or 24 months. Against their investment, they receive certain incentives.
Whatever tokens you lock in the crowdloan would then be inaccessible for staking. But then, you won’t need that anyway since the project teams offer some really good incentives.
The idea behind crowdloans is not a new one. In fact, centralized exchanges have been offering it for a long while. The only problem with them is the counter-party risk that the participants have to accept.
But when it comes to decentralized solutions that terminate third-party risks, Bounce.finance is the first.
How to Stake KSM for Kusama Crowdloan Campaign?
1. The first step is to install Clover Wallet. If you use any other wallet that supports Kusama Chain, feel free to use that. Once you’ve installed the wallet, put some KSM tokens in it to be ready to stake them.
2. It is now time for you to go to https://ksm.bounce.finance and connect your wallet.
3. Once done, you’ll see a list of projects to choose from. Make your pick and press Stake KSM on the one you’d like to support.
4. You would now be asked to specify the amount of KSM you intend to stake. When you’re ready, hit Stake.
5. And voila! That’s all there is to it. You would now see your staked balance in the dashboard.
What is Fangible?
Fangible is Bounce.finance’s NFT marketplace. The open marketplace is powered by the Binance Smart Chain. The platform is built in such a way that the artists can mint and trade digital items without paying hefty fees. This doesn’t mean that there are no fees. There’s some fee but it is much lower compared to other platforms.
The platform does a great job at removing barriers to entry for artists. Ethereum-based NFT platforms have a huge transaction fee associated with them. This, however, doesn’t limit the artists with that. As an artist, you can make your own brand pages to showcase and sell your artworks without a worry in the world.
What is Bounce Toolbox?
Bounce Toolbox is an upcoming product from the Bounce.finance team. It is a toolbox containing all the tools you would ever need to build a decentralized auction platform all by yourself.
These tools make it easier for you to harness the power of decentralized auctions. And they do it unlike ever before. From UI kits, to API access to Bounce NFTs and open source smart contracts, the toolbox would have just about everything.
It’s a great step toward bringing DeFi to the masses and making it more accessible.
Before you go…
There’s a great deal that can be said about the Bounce.finance ecosystem. And this is just the beginning. As more and more planned projects go live, the ecosystem will flourish and grow better.
What becomes of the platform in the future, however, is something we would have to wait around to see.