Prism — Introducing the Deflect DeFi Ecosystem Token
Prism is an ecosystem token being launched on the Deflect platform, backed by the Uniswap DEF/ETH liquidity pool tokens (LP) used in its minting process.
Going forward, all products on the Deflect platform will be accessed using Prism, making it one of the most valuable assets you can acquire in the Deflect ecosystem.
Prism Token
Token name: Prism
Ticker: PRISM
Starting Supply: ~34,400
Max Supply: None
Minted: When locking DEF/ETH LP in vault
Conversion rate: 0.000005 DEF/ETH LP = 1 PRISM
Starting Liquidity Pool: DEF/PRISM
TX fee: 0.25% (Exclusively goes to minters in the DEF/ETH LP vault)
Contract Addresss: https://etherscan.io/token/0xd46df541148932690b81092f600f35208afd4325
Use Case & Benefits
- Lowers the barrier to entry to the Deflect ecosystem, by means of a single token for access to all Deflect products
- Creates a liquid market for DEF/ETH LP tokens
- Incentivises ongoing liquidity provisioning to DEF/ETH pool, with a new exclusive income mechanism for minters previously not available with DEF/ETH LP tokens
- Arbitrage opportunities that create a feedback loop, forever increasing the value of the Prism token and incentivising more liquidity provisioning
- Adds another mechanism of volume generation for Deflect token
- Burned boosts for yield farming pools on Deflect
- Farming of up to 10% of Launchpad token supplies
- Future utility of being collateralised for borrow/lending products on Deflect & more
Lower Barrier to Entry
No longer do you have to buy Deflect and provide liquidity to the DEF/ETH pool, in order to gain access to the Deflect ecosystem.
Prism enables access to all current and future Deflect products through the use of a single token that you can buy on the market just like any other ERC-20 token.
It should be noted though, that there may be times when it will actually cost less to acquire Prism by means of providing liquidity, if Prism is trading at higher than its equivalent in its DEF/ETH LP counterpart.
DEF/ETH LP Liquidity
With the Prism token comes an easy way to buy and sell DEF/ETH LP, something that has been long requested by our community.
You can now trade your DEF/ETH LP through the Prism token, enabling buys and sells with virtually any other ERC-20 token.
Ongoing Incentive to Provide Liquidity to the DEF/ETH pool
The Prism token comes equipped with a 0.25% fee that’s taken every time a user sends a transaction with Prism. This fee is then split proportionally among minters in the DEF/ETH pool, depending on how much of the total Prism supply they have personally minted. This fee will be reflected as a balance that accrues over time that minters can collect as often as they like.
This creates an ongoing incentive to provide liquidity to the DEF/ETH pool and become a Prism minter, as you will receive a percentage of all Prism transaction volume forever.
Arbitrage Opportunities
Because Prism is a freely traded asset on an open market, there may be times when Prism itself costs more on the open market than it does to actually make it.
This creates an arbitrage opportunity for traders, where a profit can be realised by providing DEF and ETH to the liquidity pool, obtaining the resulting DEF/ETH LP token, minting Prism, and then selling the Prism on the open market for the difference.
The result of this is an arbitrage that is encouraged, since it benefits the entire Deflect ecosystem with each addition of liquidity forever adding to the ETH balance of the pool and raising the price floor of the Deflect token. Prism is one of the rare cases where an increasing supply of the token is actually desired.
Increased Volume Generation for Deflect Token Holders
One of the Deflect token’s flagship features is its fee redistribution mechanism, which splits a portion of all Deflect transactions among Deflect holders.
Prism further amplifies this effect and benefits Deflect holders by virtue of requiring Deflect to be bought and then supplied into the liquidity pool, a two-step process that is incentivised to be done more over time as Prism market value continues to surpass its underlying DEF/ETH LP value.
Because DEF/PRISM will be the starting and largest pool for Prism and because Prism is required to access Deflect products, any entries to and exits from the Deflect ecosystem will first be transacted in Deflect, further generating Deflect volume and subsequently, revenue for Deflect token holders.
Burned boosts for Yield Farming Pools on Deflect
As the first of many burn mechanisms that will be added for the token, Prism will be enabled as a burned boost on yield farming pools on the Deflect platform.
Users will have the option to spend Prism in order to boost their yield share in any pools they participate in in the Deflect ecosystem, thereby burning the Prism and removing it from circulation forever. This adds a deflationary measure to the Prism token, reducing supply, increasing scarcity and price, and further incentivising liquidity provisioning and the minting of Prism all over again.
Farming of up to 10% of Supply of All Launchpad Tokens
As the replacement to DEF/ETH LP for utility on the Deflect platform, Prism will now take on the benefit of enabling holders to stake it to farm up to 10% of the supply of all Launchpad tokens.
The Deflect Launchpad is a service the Deflect Protocol provides to upcoming and existing projects that assists in smart contracts advisory and the launching of their project token, among other services. You can learn more about the Deflect Launchpad here.
Minting Prism
Prism is minted by locking DEF/ETH LP in the Deflect DEF/ETH LP vault, effectively burning it forever. This is a one-way conversion, meaning you can’t go back and convert your Prism back into DEF/ETH LP later on.
The conversion rate will be locked in at 0.000005 DEF/ETH LP:1 Prism.
We’ll be releasing more details on how you can get your hands on some Prism soon.
Future Possibilities and Potential for Development using Prism
With the Prism token comes virtually limitless possibilities for strategies and developments, further building on these core principles, such as using Prism as collateral in lending and borrowing products in the Deflect ecosystem.
As Deflect continues on exploring new realms in the world of DeFi, there will likely come a time when Deflect finds its way onto other smart contract platforms and ecosystems. When that day does come, Prism will serve as the primary currency and bridge for all things Deflect.
Deflect everything through the Prism of Integrations.
Join us on the Deflect Discord server for the latest info on ecosystem developments and releases!
Discord: https://discord.gg/2zQPe92psr
