How GoldFinch, which just launched its governance token, won the favor of Coinbase/A16Z

On January 12, DeFi lending protocol GoldFinch announced the launch of the protocol governance token GFI, which will be mainly used for community governance, endorser staking, audited staking and voting, and community donations.

The total amount of GFI is 114,285,715, of which 4% have been retroactively airdropped to Senior Pool participants (as of the snapshot on December 14, a total of 5157 people), and 2.85% have been allocated to Flight Academy participants. The official also stated that at present, Senior Pool has started liquidity mining.

Subsequently, Coinbase Pro announced the listing of GFI . If the liquidity conditions are met, GFI trading will be launched today.

According to the white paper, GFI mainly has the following functions:

1. Community governance: GFI holders participate in governance to determine the direction of the GoldFinch protocol.

2. Endorser Staking: Backers can stake their GFI tokens to specific backers in order to reach consensus in advance when these backers participate in the borrower pool. The GFI can also act as a backstop for potential loan defaults.

3. Auditor Voting: Auditor voting is required to grant borrowers permission to borrow from the protocol. Borrowers pay for these votes using GFI tokens.

4. Auditor pledge: Auditors pledge GFI tokens in order to be selected to participate in auditor voting.

5. Participant Incentives: All participants receive ongoing allocations to incentivize their participation. This includes liquidity providers who fund the premium pool, backers who fund both the borrower pool and stake in other backers, auditors who participate in voting, and borrowers who successfully repay their pool.

6. Community Grants: The community may decide to provide grants to participants who make meaningful contributions to the GoldFinch protocol and ecosystem.

The initial distribution of the total GFI supply is as follows:

Liquidity Providers 16.2%; Supporters 8.0%; Auditors 3.0%; Borrowers 3.0%; Contributors 0.65%; Community Treasury 14.8%; Early and Future Teams 28.4%; Warbler Labs 4.4%;

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How to participate in Senior Pool liquidity mining

As set, 8.0% of tokens are allocated to ongoing premium pool liquidity mining. For each block, GFI is distributed proportionally to all staked FIDUs according to the distribution rate.

The allocation rate is dynamically set by the protocol based on the amount of funds in the premium pool relative to the target. First, the target is currently set to 100M FIDU. When the premium pool falls below the target, the allocation rate will increase to the maximum rate, which is currently 0.5% per month. When the premium pool is above the target, the allocation rate gradually decreases, reaching 0 when the pool is 2 times the target. Governance can adjust all of these parameters. Participation link: https://app.goldfinch.finance/pools/senior.

In other words, when the pool balance is below its target, the distribution rate is higher, incentivizing more people to contribute funds to the pool. When the pool balance is above its target, the distribution rate will be lower, incentivizing withdrawals.

Importantly, in order to incentivize long-term consistent liquidity providers, these allocations will be unlocked over a 12-month period. Liquidity providers can unstake and withdraw at any time. If they do this before the full 12-month unlock period, they will receive a distribution percentage proportional to how many of the 12 months they have staked and forfeit the rest.

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current parameters

As of January 11, 2021, the allocation rate parameters are set as follows:

Target Balance: $100M
Minimum Rate: 0 GFI
Maximum Rate: 0.5% of monthly GFI supply (this equals 0.217438574961948 GFI/sec)
Target Range: $ 50M to $200M (50% to 200%)

Protocol governance can always decide to change these parameters.

Project Introduction

The Goldfinch protocol grants credit lines to lending institutions through which they can borrow stablecoins from the protocol’s pool of funds. After the institution obtains the stablecoin, it exchanges the stablecoin for fiat currency and lends the fiat currency to its users through traditional means. In this way, the off-chain market can fully enjoy the value of on-chain assets, and the value of on-chain assets will also be infinitely amplified. The issuance, underwriting and related business of all off-chain debt will be handled by relevant professional institutions. Goldfinch aims to be a fully decentralized credit platform. Currently the project has initiated several key steps to do this: 1. Establishing a community governance portal and process at gov.goldfinch.finance, where the community can make suggestions and participate in snapshot voting using their GFI. 2. Form a Goldfinch committee, which will conduct limited types of on-chain transactions based on community snapshot votes.

The two co-founders of the Goldfinch protocol, Michael Sall and Blake West, are both from Coinbase. In the seed round, Goldfinch also received support from institutions and industry VIPs including Coinbase Ventures. In June 2021, Goldfinch secured an $11 million Series A round led by a16z . On the 7th of this month, Goldfinch once again completed a $25 million A+ round of financing led by a16z , with the participation of well-known hedge fund manager Bill Ackman, encryption investment institution BlockTower and investment management company Kingsway Capital. At the same time, Goldfinch announced that it was reorganizing, creating the Goldfinch Foundation to help the protocol enter its next phase of growth. The original team behind Goldfinch is spinning off to Warbler Labs, which will become an independent organization contributing to the Goldfinch community and the wider DeFi ecosystem.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/how-goldfinch-which-just-launched-its-governance-token-won-the-favor-of-coinbase-a16z/
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