All your questions answered.
Lockdrop Details
What is a lockdrop?
Users lock capital in Bastion for anywhere from 1–12 months for an upfront distribution of BSTN and NEAR rewards. Upon reaching the claim unlock date, users can reclaim 100% of their deposit. This serves to achieve a fair launch while bootstrapping sustainable liquidity.
The lockdrop model, pioneered by Delphi Digital, raised $1.2bn for Astroport Finance just two months ago and revolutionizes the initial public token launch landscape. Bastion is one of the first protocols to conduct a lockdrop outside of Terra. Read more about the advantages here.
TLDR;
- Temporarily lock cUSDC, cUSDT, cNEAR, or cETH for 1–12 months to receive BSTN and NEAR rewards. The longer the lock duration, the greater BSTN received
- Up to 8% of BSTN supply and $2M NEAR rewards will be distributed
- Lockdrop participation period: FIVE days. Beginning Saturday March 19th at 8am PT and ending on Thursday March 24th
- BSTN Rewards are distributed upfront shortly after the lockdrop period, proportional to the user’s size and lock duration
- NEAR Rewards are distributed upfront shortly after the lockdrop period, meaning users can cash out 40%+ APR instantly
- Lock duration is not factored in the distribution of NEAR rewards, meaning a user will receive the same amount of NEAR from depositing $1k for 1 month as another user who deposits $1k for 12 months.
- Pre-mining is still ongoing, but future rewards are heavily allocated towards the lockdrop.
- Conducted on Aurora Mainnet at ido.bastionprotocol.com
- Contracts reviewed by top-tier auditors, including Quantstamp
- No whitelist. Available to all participants.
Timeline of Lockdrop
Lockdrop participation period: FIVE days. Beginning Saturday March 19th at 8am PT and ending on Thursday March 24th.
BSTN and NEAR rewards will be claimable by users sometime between March 24th and April 1st.
Have the contracts been audited?
Our lockdrop code has been reviewed by top auditors. Please find the reports from Quantstamp (here) and Sentnl (here).
What assets does the lockdrop accept?
The lockdrop accepts Bastion cTokens, specifically cETH, cNEAR, cUSDC, and cUSDT from Main Hub only. cTokens are tokens you automatically receive as a receipt for depositing into Bastion. They accrue interest against the underlying tokens automatically. Note: Bastion’s underlying codebase for Main Hub is almost identical to Compound.
How does the lock duration multiplier work?
The longer you choose to lock, the more $BSTN you will receive. This weighting, however, does not apply to the NEAR rewards. For every dollar a 1-month depositor commits, a 6-month depositor will get 6x their amount in BSTN. See the table below.
Is there restrictions on deposits?
No, a user can deposit different cTokens into different lock durations, multiple times.
Is there a difference between depositing on the first day or the last day?
No. The price of your cTokens and distribution of rewards will be calculated on the last day. There is no advantage to depositing earlier or later in the lockdrop period.
Why did we choose the lockdrop model?
Delphi Digital does a comprehensive explanation of the many advantages of the lockdrop model compared to traditional public token launch mechanisms such as LBP, fixed auctions, and airdrops.
In short, the lockdrop model allows users to earn BSTN and NEAR rewards at zero cost since users can withdraw 100% of their capital after several months. It allows the protocol to develop a sustainable TVL which helps subsidize rates over the medium term. This optimizes for the most loyal supporters of Bastion and gives smaller holders the ability to accumulate more.
Can I withdraw?
At the end of “X” lock months, you can withdraw your principal fully, after having earned all the extra rewards already! However, once cTokens have been deposited, users cannot withdraw them until the end of their committed lock duration (i.e. cannot randomly withdraw during the five-day lockdrop period).
Yield and Rewards
Does this change anything about pre-mining? Has pre-mining been a waste of time?
Not at all! Pre-mining will only end once the token is live. The lockdrop and pre-mining are completely separate things. Participating in the lockdrop is optional. Our pre-mining rewards are at a 0.5% weekly rate (i.e. the same as Aurigami’s). Nothing has changed regarding our pre-mining rewards, and you will still be airdropped your rightful share that you have already earned over the past 2 weeks for Epoch I. Epoch II begins after Lockdrop Phase I.
The 8% for the lockdrop is coming from the Treasury (30% of BSTN supply). The ~1% for pre-mining is coming from the Liquidity Mining Reserve (also 30% of supply).
Despite the pre-mining seeming small compared to the lockdrop, it is very commonplace for DeFi protocols’ IDOs to be the largest token distribution event. Firstly, the pre-mining rate is still much higher than the usual liquidity mining rate. Moreover, this order of allocation is not unusual: Public Sale > Premining > Post-Launch Liquidity Mining.
Why should I participate in the lockdrop if I can just pre-mine?
Every dollar deposited in the lockdrop could yield >50x more rewards than the same $ deposited in Bastion normally. Opportunity cost is minimal, especially when your deposit will still be earning juicy yield in Bastion.
50x is a ballpark number, so let’s explain how we calculated it. Bastion’s TVL during the pre-mining period averaged $320mm. Premining emissions have been at 0.5% weekly (same as Aurigami’s) and has been going on for 2 weeks. In comparison, the lockdrop is distributing 8% of supply, and will raise a much smaller subset of TVL (perhaps ~$60mm TVL). Furthermore, users who lock in for 12 months receive a 12x multiplier on their BSTN received. If we factor in the smaller TVL (less dilution), lock duration multiplier, and higher BSTN supply dedicated to the lockdrop, it is clear that participating in the lockdrop could yield more than 50x greater BSTN rewards than even premining.
Is there a lockdrop calculator available?
Yes. You can view it at tinyurl.com/lockdropcalc.
What is the formula for calculating the amount of BSTN a user is entitled to?
The formula used to calculate the number of BSTN for a user “i” at the end of the five-day lockdrop period is:
How much will my $BSTN be worth?
Here is an example calculation of the payoff for depositing $1,000 for different lock durations. It is based on assumptions such as that everyone else locks for 1 month, and that the token price of BSTN is $0.20.
What does it mean when you say “up to 8% of BSTN Supply”?
We will only give away the full 8% of BSTN supply if the amount raised in lockdrop TVL is greater than $60mm.
Can I lock assets that I am currently using as collateral or borrowing against?
Yes! You would be able to lock a partial amount of these cTokens. However, locking them in the lockdrop vault is equivalent to sending your cTokens out of your balance into a temp-locked vault. They will no longer be factored into your borrow limit, meaning your borrow limit and borrow utilization will decrease.
Can I borrow against the cTokens I lock up while the lock is active?
No, you will not be able to. Depositing your cTokens in the lockdrop is equivalent to sending your cTokens out of your wallet into a temp-locked vault, meaning it will not be factored in your account when viewing the Bastion main site.
Does this mean I cannot do recursive borrowing and get leverage to deposit into the lockdrop?
Kind of. As stated in the previous question, you are able to lock cTokens that you are currently using to borrow. If you are recursive borrowing, you will be levered up closer to your borrow limit and will have less “free” cTokens to lock.. You will certainly not be able to deposit your entire looped amount into the lockdrop as that would leave a large amount of borrow outstanding that is not backed by any collateral.
Does it matter what type of asset I deposit? Do you favor each of the cTokens differently?
There is no weighting on the type of asset deposited. It does not matter whether you deposited cNEAR, cETH, cUSDC, or cUSDT. We will simply take a snapshot at the end of the lockdrop period of the dollar amount your deposit is worth.
How did you arrive at 40% APR for NEAR rewards?
If someone locks up for 12 months, we cannot guarantee that they will receive 40% APR. The $2mm rewards is just for the first month (for now), which translates to an annualized rate of approximately 40% if the lockdrop TVL is less than ~$60mm. After $60mm raised, the APR decreases as indicated by the chart below.
How long should I lock for? If $2m NEAR rewards are only guaranteed for the first month and their distribution does not factor in lock time, why don’t I just deposit for only 1 month to maximize short-term profits?
NEAR Rewards don’t factor in lock time, but a linear time-weighted multiplier is applied for BSTN rewards. For example, 3 month lock gets 3x BSTN airdropped, 6 month lock gets 6x BSTN amount etc. If you are a yield-farmer who just wants to secure 1 month of 40% APR, it may make sense to lock for 1 month. However, if you believe that being early to BSTN, the token of a fundamental DeFi primitive on Aurora will have more upside (even in the short term), then it may make sense to lock for longer to get a much larger amount of BSTN. None of this is financial advice. Do your own research and make investment decisions independently.
Participating in the Lockdrop
Step-by-step guide:
- Deposit USDC, USDT, NEAR, and/or ETH into app.bastionprotocol.com
- You automatically receive cTokens as a receipt of deposit!
- Go to ido.bastionprotocol.com
- Select the token you want to lock, and for how long
- Click Approve
- Click Lock Asset, and Proceed
- … Redo the above steps if you would like to lock even more cTokens for different periods of time. There are no restrictions on deposit terms.
For more help on using Bastion Protocol, please visit: https://bastionprotocol.gitbook.io/official/using-bastion/desktop-guide
How do I get cTokens?
Go to app.bastionprotocol.com and deposit into the Main Hub. cTokens are tokens you automatically receive as a receipt for depositing into Bastion. Then, deposit the cTokens into ido.bastionprotocol.com.
How to move funds from “X chain” to Aurora?
Aurora has bridges with almost every chain. Check out the “Bridges” button at app.bastionprotocol.com. Rainbow Bridge supports bridging from Ethereum to NEAR/Aurora for most major assets (just click “Show all tokens”). Here is a guide for bridging from Ethereum: bastionprotocol.gitbook.io/official/using-bastion/bridging-assets-to-aurora.
Do I have to pay for the Lockdrop?
You don’t pay at all, we give you the BSTN lockdrop rewards, NEAR rewards, and deposit APR for free essentially. You will be able to withdraw 100% of committed funds at the end of the lockdrop period. The only opportunity cost is that of locking your capital up for 1–12 months.
How to view cToken balance?
cTokens are hidden on Metamask by default so you must manually import them. However, you do indeed receive cTokens in your Metamask Wallet everytime you deposit. You can check your token balance by entering your wallet address into aurorascan.dev.
Post-lockdrop
How will you distribute the NEAR rewards on my locked deposit?
We will be distributing upfront $2,000,000 in NEAR rewards to users proportional to the amount of tokens they have locked into the contract.
About Bastion
Bastion is a decentralized lending and borrowing protocol built on Aurora, NEAR’s EVM-compatible layer. Building on Aurora enables Bastion to create an autonomous interest-rate engine with superior capital efficiency, fast transactions, ultra-low transaction fees, precise liquidations, and harness the underlying UX benefits of NEAR.
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DISCLAIMER: This article does not constitute investment advice. Bastion Protocol Token (BSTN) is a means by which users may utilize and govern the protocol. Bastion does not recommend purchasing BSTN for speculative investment purposes. BSTN tokens may lose value or have no value and may have no market. Please read the full disclaimers here.
Participation in this lockdrop involves significant technical risks and uncertainties. Before interacting with Bastion, review the project disclaimers here. It is a user’s responsibility to understand the nature of such risks, the practical irreversibility of the relevant blockchain transactions and the absence of reliable or readily available remedies for any loss or impairment of tokens or other damages you might suffer by participating in Bastion’s lockdrop.
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