The Defi ecosystem is busy leasing out great products and projects that portray a continuous increase in quality and value. However, we’ll bet nobody can envisage the future surprises from the decentralized finance space.
Speaking of the product from the decentralized ecosystem, one of the outstanding is Curve Finance. Though the project has a simple concept, it has made a great move within few weeks since its launch. As a result, the protocol now takes a huge stance as one of Defi’s prominent platforms.
This brings us to the main focus of this review; Ellipsis Finance, the authorized fork of Curve Finance. Its operability and functionality are drawn from Curve Finance but with a great difference as it runs on the Binance Smart Chain.
This article presents a review of Ellipsis Finance and AMM, its EPS token, how to earn the token, and more. Get right to the end to understand and grab more information on this great Defi cryptocurrency.
What is Curve Finance?
To create a clearer understanding of Ellipsis Finance, the authorized fork of Curve Finance, we first look into the parent fork.
Curve Finance is a decentralized exchange that runs on Ethereum to provide efficient swapping means between stablecoins. The uniqueness of Curve is that it removes impermanent loss and reduces slippage for liquidity providers and traders, respectively.
Launched in January 2020 by Michael Egorov, the platform has emerged as one of the top exchanges for stablecoins. Though the Russian Physicist Egorov has been working on Defi projects since 2018, it took him two later to present Curve, his DEX.
Curve Finance runs on the Ethereum Blockchain as an exchange for Bitcoin tokens and stablecoins. It aims at providing users with the right platform for the swapping of some Ethereum-based cryptocurrencies. By focusing on stablecoins, Curve Finance paved the way for its popularity and success in the industry. Also, the protocol deals with the issues of impermanent loss and slippage for both liquidity providers and traders.
As an Automated Market Maker, Curve Finance utilizes its technological algorithm in providing liquidity pools for its users. Furthermore, the protocol distinguishes itself on the Defi space with its real-time trading data for customers. Thus, Curve Finance has outstanding and best prices for stable assets and stablecoins in the industry.
Other conventional market makers depend on the assets and holdings on their platforms for liquidity; Curve operates differently. Curve Finance aggregates liquidity for users with assets backed by all its markets.
Furthermore, it supports seamless and fast trading of Bitcoin pairs. Also, users can swap several stablecoins like USDT, USDC, DAI, BUSD, TUSD, and others.
What is Ellipsis?
Ellipsis Finance is an authorized fork of Curve Finance that runs on the Binance Smaart Chain. Just like Curve, Ellipsis Finance allows the swapping of stablecoins. The platform was launched in March 2021 and will be getting support from the Curve Finance team as its parent fork.
Ellipsis Finance will maintain the core value of Curve Finance. This implies that users will experience zero fees on deposits and withdrawals. Moreover, there will be extremely efficient stablecoin swaps and no lock-ups on liquidity.
Through the use of a bonding curve for swaps, the protocol a huge difference for its users. They have the opportunity of swapping stablecoins with extremely low slippage. This’s quite unlike other decentralized exchanges where traders are stock with high slippage for trading cryptocurrencies. The swapping fee on Ellipsis Finance is very enticing for users being set at 0.04%. Also, through the provision of liquidity, traders are allowed to farm the protocol’s tokens.
Furthermore, veCRV holders of Curve Finance protocol would get 25% of the total Ellipsis Finance token supply. The tokens will be airdropped every week for over one year. This move is based on the fact that Ellipsis Finance is an authorized fork of Curve Finance.
For those who don’t know what veCRV is all about, we’ll give a little explanation. It’s a vote locking deposit that is utilized on Curve Finance. First, CRV holders will lock their token holdings in the protocol’s DAO.
This attracts rewards of veCRV tokens, which is the governance token on the platform. Thus, vote locking enables a user to vote in governance, the prominent utility of veCRV in Curve Finance. Also, users receive more veCRV when the period of their locking is longer.
Ellipsis Finance kicks off with swap pairs for BUSD, USDT, and USDC. The first supported swap pair on the platform is BUSD/USDC. The protocol plans on more pairs addition in the future.
Ellipsis Token – EPS
Ellipsis Finance native token is EPS. This native token gives value for both the liquidity pools and the token holders.
The EPS token has its maximum supply limit set at one billion coins. Also, the emission for the token is with a schedule of over five years. Currently, the protocol has a circulating supply of 333,938,807 tokens.
At the time of writing, the EPS price is $0.6328 per token, which shows an increase of 0.81% within the last 24 hours. Ellipsis Finance boasts of a market cap of over $290 million.
The token distribution of Ellipsis Finance has the following distribution:
- 55% Liquidity Provider Rewards – Continuous 5 years minting with a rate that decreases progressively.
- 20% Development/Team Fund – Has one-year vesting with a continuous release.
- 25% veCRV Airdrop – Weekly distribution that follows a veCRV snapshot.
The EPS token operates as a revenue-earning token. Thus, by staking their EPS tokens, users will get rewards from fees on Ellipsis Finance.
Fees on the Elipsis follow a pattern in its sharing. While EPS Stakers get 50% of the fees, the remaining 50% is shared between the Liquidity Providers Reward Pool and Staking Pool.
Reward and Staking Pools
Liquidity providers usually receive EPS from the reward pool. Rewarded EPS are vested over three months and can claim trading fees. The early claims come with a 50% penalty.
Also, where a user exits a vest earlier, there will be a 50% penalty irrespective of how early or late the exit was. Every 50% penalty goes to the EPS lockers/liquidity providers. This means that the most loyal EPS holders can receive the largest benefit after the vesting period.
Furthermore, the Staking Pool gets trading fees and the EPS Penalty Revenue from the early exit of the vest. However, the Staking Pool has no mandatory lock-up. So, traders have the right to claim their EPS rewards from locking tokens without any penalty.
Liquidity Provider Rewards
Liquidity providers receive a share of 80% of the rewards. The remaining 20% of the rewards are distributed to EPS/BNB liquidity providers. The distribution of the Liquidity Provider rewards is as follows:
- 30% rewards within Year 1 that are distributed as shown below:
- 5% in Month 1
- 4% in Month 2
- 3% in Month 3
- 18% for the rest of the year 1 (2% for each month)
- 5% within Year 2
- 25% within Year 3
- 125% within Year 4
- 125% within Year 5
Ellipsis Finance EPS and Trading Fees Earning
Users have several ways of earning EPS on the Ellipsis protocol. Here are some of these ways:
By Depositing Stablecoins in an Ellipsis Exchange Pool
A user can deposit stablecoins into an Ellipsis liquidity pool to earn LP tokens. As an automated market maker, Ellipsis enables exchange between several stablecoins at a reduced slippage. The protocol achieves this by providing much liquidity on the platform.
The liquidity pool increases as more users deposits their stablecoins which makes them part of the liquidity providers. As a result, the value of the LP tokens will appreciate with time attracting more trading transactions ad fees. The protocol then shares the trading fees among the liquidity providers.
By Depositing LP Tokens and/or EPS/BNB LP Tokens
You can earn EPS by depositing your LP tokens and /or EPS/BNB LP tokens.
- Depositing LP Tokens
Not only is the EPS token used as a rewarding coin, but it also serves as a value-capturing coin on the platform. Staking your EPS tokens allows you to receive from trading fees generated during exchanges on the platform. Usually, the distribution of EPS as a liquidity providers reward follows the process of Liquidity Mining.
You can earn EPS using your LP tokens by visiting the ‘staking’ page on the Ellipsis official website. Then select the pool that you hold LP tokens for and click on the deposit button. This transfers your tokens into a reward contract and enables immediate EPS earnings.
Thus, your claimable balance will keep increasing with each new block mining on the protocol. Also, you are entitled to withdraw your LP tokens at will. Ellipsis Finance has no fee for deposits and withdrawals from the reward contract. Moreover, there’s no locking of LP tokens on the platform.
- Depositing EPS/BNB LP Tokens
The second method of deposits to earn EPS is that of EPS/BNB LP tokens. This pool has a higher APY than those of the regular Ellipsis liquidity pools. You can enter this pool by first obtaining EPS and BNB balances.
Then, to get the EPS/BNB pair, you will visit the PancakeSwap page. Proceed by clicking on the ‘Add Liquidity’ and deposit your tokens into the pool. In conclusion, you’ll deposit your LP tokens by visiting the Staking segment of the Ellipsis official website. This will allow you to start earning EPS immediately.
By Claiming Your Vested EPS
You can earn the protocol’s trading fees through the claims of your EPS. Usually, you will see an option to Vest EPS once you’re done with the staking of your LP tokens. Choosing this option creates new EPS tokens (the minting of EPS) deposited automatically into the distribution contract fee. Then, you will be getting a portion of the protocol’s generated trading fees. Note that the trading fees are shared 50/50 between EPS stakers and liquidity providers. Also, there’s a periodical transfer of the pool fees to the distributor contract with an even release within the next seven days.
Newly minted EPS has a vesting period of 90 days (three months). Withdrawing your tokens before the completion of the period has an early exit penalty of 50%. Once the vesting period is completed, the EPS is unlocked, and you can freely withdraw them.
Furthermore, you can buy EPS from PancakeSwap to deposit in the fee distributor to earn a portion of the trading fees. Staking EPS through such means keep the tokens unlocked and can be withdrawn without penalty at any period.
Locking of EPS to Receive From Early Exit Penalties
There’s the opportunity of locking your EPS wallet balance within the fee distribution contract. It doesn’t matter whether you earned the tokens or purchased them on PancakeSwap. You can’t withdraw such locked EPS for three months (90 days) since there’s no penalty for early withdrawal of the locked EPS.
Locking your EPS indicates your commitment to Ellipsis’ long-term vision. So, as early exit users pay their penalties, you stand the opportunity of earning 100% through your locked EPS. Commencing the exit penalty fees distribution is immediate; there’s an early withdrawal from a vested user. It will follow an even release within the next one week of such exit.
Locking CRV on Ethereum
Like we’ve said earlier, Ellipsis is an automated fork of Curve Finance, an AMM that runs on the Ethereum Blockchain. As such, Ellipsis commits to airdrops 25% of its total token supply to the Curve DAO members with veCRV tokens. Users can only receive the EPS airdrop by locking their CRV tokens in Curve’s Vote Escrow to get veCRV.
The airdropping of EPS occurs every week through a Merkle distributor with some proof. The Curve team assists in processing and validating the proof for security for the EPS holders. From the snapshot of the current veCRV balances, the team will generate the Merkle root for the EPS airdropping.
Where and How to Buy Ellipsis Finance (EPS)
It’s always advisable to use a trusted and reputable platform to buy or trade on digital assets. That’s one of the safest means of avoiding fraud and loss of funds.
EPS is listed on some platforms. For example, you can get EPS on the Binance mainnet. Other platforms include PancakeSwap, ApeSwap, CoinEx, CoinDCX, etc.
Note that you can’t directly purchase Ellipsis Finance token using fiat currency. Instead, you will first buy another cryptocurrency such as Bitcoin, Ethereum, and others and exchange the EPS tokens.
Follow the steps below to buy EPS tokens:
Register and open an account with a crypto exchange
The first step is to register and open an online account with a crypto exchange such as Binance. Then, you will visit the official website and click on register account/sign in. Next, complete the account opening on-screen form using your details such as name, email address, phone number, and others.
Verify and fund your account
When you’ve opened the account, you should upload any government-issued such as your driver’s license or passport. Also, upload a copy of your recently issued utility bill or bank statement. These serve as your KYC documentation on the platform, and most regulated exchanges will depend on such processes. The exchange will then send you a confirmation message for the verification of your account.
Once you’ve received the confirmation, you can proceed to deposit your fiat currency. Binance supports payments through credit/debit cards, bank transfers, and even e-wallets. Choose any deposit option that is most convenient for you.
You can buy any prominent cryptocurrency like BTC, ETH, BNB that you will swap for the EPS tokens. First, search for the crypto pair you want to purchase using your fiat currency. For instance, if you’re buying BTC with USD, you will select the BTC/USD pair from the search box. Then click the BUY button.
Swap the crypto for EPS tokens
When using Binance exchange, you won’t need to move your crypto coins to another platform for swapping the coins. Instead, you can complete the whole process right on the Binance platform. However, Binance is not authorized for US residents. So, if you’re residing in the US, you’ll have to use another platform to buy and swap for your EPS tokens.
You can proceed to swap/exchange the BTC tokens for EPS tokens. Click on the EXCHANGE button and select the pair EPS/BTC. Then input the amount of EPS tokens you wish to buy or the BTC you wish to sell. Confirm your order and click the EXCHANGE button. You will get the EPS tokens in your account.
Conclusion of Ellipsis Review
Ellipsis Finance is a new decentralized exchange and an authorized fork of Curve Finance. The protocol’s team gets support from Curve, which helps Ellipsis to inculcate the core values of Curve. The platform operates without fees on deposits and withdrawals.
Being built on the Binance Smart Chain, Ellipsis has a slight advantage over other AMM on the congested Ethereum blockchain. The platform boasts of fast completion of transactions with minimal fees. Also, users have the provision of swapping their stablecoins with reduced slippage and no impermanent loss.
Ellipsis Finance has made a great wave within its period of launch to now. The protocol has the potential of striving higher in the future within the Defi ecosystem. However, before committing to the world of digital assets, you should do your research and consider your risk tolerance.