The idea of being able to receive price protection for cryptocurrency is something that, up until recently, seemed a long way off. In the midst of an explosion of DeFi protocols, Bumper Finance has stepped in to fill the gaping hole in the cryptocurrency market, to allow people to protect their crypto without losing any of the upside.
Over the past month, the volatility of cryptocurrency has been sending shockwaves through the market, leading many concerned investors fleeing for the hills.
The situation would perhaps be different, if investors were able to avoid cryptocurrency’s extreme volatility, or rather than avoid, simply side-step.
Bumper has, through its innovative protocols and near-zero slippage engine, managed to create a scenario in which investments are fully protected through a price protection protocol that converts a volatile asset to a stablecoin, and gives liquidity providers the ability to earn an outperforming yield.
The popularity of Bumper has so far been demonstrated through a heavily oversubscribed private sale round in March, which saw them close $10m from Alphabit, Autonomy, Beachhead, Chainlayer and others. Now the Bumper community can get involved and receive BUMP tokens by depositing USDC into the protocol and yield-farming BUMP tokens.
Aside from contributing towards an innovative price protection protocol, Bumper’s liquidity providers are particularly well rewarded, as the following five points demonstrate.
1: Earn rewards for farming BUMP during the LP Program
Liquidity providers are crucial to Bumper’s protection mechanisms as they are needed to fill the liquidity pool and counterbalance “takers” wishing to protect their assets. The most obvious benefit of being an LP is that you will get paid to do so. Bumper wants to reward our early supporters, which is why we’re providing them with the opportunity to access the LP Program and deposit USDC into the protocol and yield-farm BUMP tokens. The LP Program will run for 12 weeks starting on July 14th, with USDC to be locked up until October 14, after which you will be able to reclaim your deposit and receive your BUMP to reinvest should you wish to do so (which, with no risk of impermanent loss would be a smart thing to do).
2: Gain exclusive access to our private sale to earn over 300% APR.
As an early liquidity provider, you will receive the best possible yield and alongside having access to the LP program, from July 14th you’ll also be provided with access to a BUMP Private Sale. Participants of the private sale will be able to buy BUMP by swapping up to 20% of their USDC deposit at a special Private Sale price. The first Liquidity Providers to deposit USDC and swap 20% to buy BUMP will receive the best achievable yield of 315% APR. There is currently $22m + worth of bump to be farmed and bought and the higher the TVL, the higher the token price will go. If you choose not to buy BUMP when you deposit USDC, you will in all likelihood miss out on the chance to buy until the public sale, and at that point the price of the BUMP token will have gone up considerably.
3: No risk of impermanent loss
The protocol requires that USDC deposits are locked up until October 14th 2021, however Makers of protection who provide liquidity are never at risk of impermanent loss. Impermanent loss that occurs when the price tokens change (compared to when you deposited them in the pool) is avoided in this scenario since Bumper only uses USDC for their provision. Furthermore, LP’s will receive risk-free interest down the road in the form of a portion of the premiums paid by policyholders.
4: Passive yield for lending your USDC to the protocol
As the Bumper token price and the TVL are intrinsically connected, the higher the TVL is, the higher the token price will go. At the LP Private Sale, tokens will go for the private sale price of $0.60+ , by the end of the program the token is expected to reach $1.80, with the 20% cap removed, allowing swaps of up to 100% of USDC for BUMP. The Public Sale price is expected to be around $2.40. If you are an early LP, and having made a deposit on day 1, you could receive a yield of 100% APR, simply from signing up to the LP program early on.
5: Only LPs are eligible to buy BUMP
The LP Program will be the first occasion for the Bumper community to get involved, and BUMP is reserved for those who wish to provide liquidity. The early interest in BUMP by the Bumper community means that the private sale will be reserved strictly to those who wish to provide liquidity, and in turn BUMP token early buyers will be looking to receive 315% APR. Those who don’t wish to miss out are encouraged to sign up to the private sale rather than waiting for the public sale.
To find out more about Bumper Finance's LP Program, and to deposit into their liquidity pool, visit https://bumper.fi/lpp
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.