On Friday, Bifrost, a Web 3.0 derivatives protocol that provides decentralized cross-chain liquidity for in-game assets, launched the updated Slot Liquidity Auction Protocol dubbed “SALP 2.0.” Projects like Moonbeam, Unique network, OAK network, Polkadex, etc. kept their parachain crowdfunding on Kusama and Polkadot through the original SALP. A total of 177,690 vsKSM ($439 million) and 3,045,564 vsDOT ($21 million) were minted through the protocol.

The SALP protocol works by releasing the liquidity of staked tokens during an auction; liquid derivatives like vsDOT and vsKSM are issued at a 1:1 ratio for tokens staked. Both vsDOT and vsKSM can be used for decentralized finance, or DeFi, apps and rewards across the ecosystem, as long as the native tokens remain locked for the duration of the parachain lease.

This avoids the opportunity cost of locking up your coins. However, the new SALP 2.0 allows users to obtain liquid tokens through direct investment, not just through participation in crowdlending. Tyrone Pan, Head of Development at Bifrost, commented:

“The SALP 2.0 upgrade is generating a bond market for Crowdloan assets, improving the liquidity efficiency of vsToken and vsBond while lowering the threshold for users. This model not only makes it easier for Crowdloan users to manage of derivatives, but also cleverly combines Crowdloan with DeFi.”

Liquid staking is a relatively new phenomenon in the DeFi space, created primarily to allow users to recoup potential opportunity costs while staking their assets. The potential downside is their vulnerability to changes in the underlying assets, as they are classified as DeFi derivatives.



This post Bifrost Releases Updated SALP 2.0 After Protocol Helped Secure $450M Through Parachute Auctions

was published first on https://cointelegraph.com/news/bitfrost-releases-upgraded-salp-2-0-after-protocol-helped-secure-450m-via-parachain-auctions

Author

Write A Comment