Fundraise, tokenomics, and IDO

We’ve got a doozy of an update for you!

TL;DR:

Announcing $6.5M raise from Polychain, Dragonfly, Race, and others

IDO for 4% of total supply will be live at ido.solend.fi on Nov 1 12:00pm UTC

100M SLND total supply

Since announcing our liquidity mining program last week, Solend’s deposits have grown 80% to over $360M in deposits and $180M in borrows, making Solend the largest lending protocol on Solana by outstanding borrows!

Additionally, Solend has:

68K accounts with at least $1 deposited

26K Twitter followers

11K Discord community members

Fundraise

We’re excited to announce that we’ve raised $6.5M from some amazing investors and builders: Polychain, Dragonfly, Race, Coinbase Ventures, Solana Ventures, Alameda Research, Stani from Aave, Antonio from dYdX, Balaji Srinivasan, Hart from UMA, 0xMaki, Julian from Ribbon, DCFGod, Petrock, Epsilon Trading, and others. This has been in the works for a long time and we’re happy to finally announce it!

Tokenomics

There are 100M SLND tokens. SLND’s distribution is as follows:

SLND token distribution. Note that IDO allocation is part of the treasury.

60% of SLND is allocated to the community. Breaking it down, half of that is allocated for the liquidity mining program and the other half is allocated to the Solend Treasury, owned and governed by the Solend DAO. 5% of SLND is allocated to the IDO, coming from the treasury. The Solend Treasury will own the IDO funds and LP position (details in IDO section.)

25% of SLND is allocated to the core team.

15% of SLND is allocated to investors. Only 10% was distributed in the seed round, but an additional 5% is set aside for a potential future raise in case it’s needed.

Lockups

Seed investors have a 3-year vesting schedule with the first third vesting October 1, 2022, and the rest vesting monthly after. The team also has a 3-year vesting schedule with the first third vesting June 1, 2022 or later (based on join date). There is no lockup for IDO participants.

IDO

How the IDO works

The Solend IDO is modeled after Mango’s. It consists of two consecutive 24 hour phases: a sale period in which USDC may be deposited or withdrawn, and a grace period in which USDC may only be withdrawn. Afterwards, depositors can redeem an amount of SLND tokens proportional to their share of the pool.

IDO details

The IDO will be live at ido.solend.fi. A total of 5% of the SLND total supply is set aside for the IDO: 4% for the IDO itself and 1% to LP SLND-USDC after the IDO has ended. (A quarter of the IDO proceeds will also be used to LP.)

The timing of the IDO is as follows:

Nov 1 12:00pm UTC: Sale period (deposit and withdraw)

Nov 2 12:00pm UTC: Grace period (withdraw only)

Nov 3 12:00pm UTC: IDO ends

Nov 3 16:00pm UTC: Tokens become redeemable

The IDO is not available to users in the following regions: Afghanistan, Ivory Coast, Cuba, Iraq, Iran, Liberia, North Korea, Syria, Sudan, South Sudan, Zimbabwe, Antigua, United States, American Samoa, Guam, Northern Mariana Islands, Puerto Rico, United States Minor Outlying Islands, US Virgin Islands, Ukraine, Belarus,, Albania, Burma, Central African Republic, Democratic Republic of Congo, Lybia, Somalia, Yemen, United Kingdom, Thailand. Traffic from these regions are blocked by IP address.

Why IDO?

All proceeds from the IDO are going to the Solend Treasury which is owned and governed by the Solend DAO via SLND tokens. The treasury funds will be used for insurance, grants, user acquisition, and anything the Solend DAO decides. The IDO also serves to diversify the Solend Treasury, making it more resilient to black swan events or a bear market.

Insurance fund

There are many risks to watch out for in a lending protocol. Namely smart contract risk, oracle risk, liquidation risk, market risk, and platform risk (though there are even more!) Additionally, every asset listed exposes Solend to additional risk. Consider two scenarios:

Scenario 1: RISKY, an imaginary token with minting controlled by a DAO, is listed on Solend. The RISKY governance process is subverted, allowing an attacker to mint an infinite number of RISKY tokens. The minted RISKY tokens are deposited in Solend and used as collateral to borrow all other available assets on Solend. RISKY is dumped, bringing the value of collateral to effectively 0. In this scenario, the value at risk is min(deposit limit * RISKY LTV, available liquidity).

Scenario 2: RISKY, an imaginary token is listed on Solend. There are hundreds of ways to manipulate an oracle but let’s just say it’s done one way or another. RISKY’s price is misreported as an extremely large number. Once again, RISKY tokens are deposited and used as collateral to borrow all available liquidity. In this scenario, the value at risk is simply all of the available liquidity. Note that deposit limits and LTVs don’t help here since even one RISKY token is effectively worth an infinite amount.

Add to this that with Solana’s 400ms block times, all of this could literally happen in the blink of an eye.

Solend takes risk extremely seriously and does extensive diligence on each asset that’s listed, also tuning risk parameters accordingly. Unfortunately, no amount of diligence can completely mitigate all risk, which is why it’s important to build up a sizable insurance fund.

Liquidity mining rewards

The liquidity mining rewards which were announced last week will become claimable on Nov 15 at 12pm UTC. Following that, liquidity mining rewards will be claimable on a monthly basis until Liquidity Mining 2.0 (call option rewards) is live.

Additionally, the Dorahacks vote airdrop and Nope token conversion will also be available on Nov 15. These are also coming out of the Solend Treasury.

Roadmap

Since launch, Solend has focused on being the fastest and easiest-to-use lending protocol. Now with the help of the community, we will continue to improve Solend with the following:

Call options liquidity mining program (more details soon)

Upgrading Solend’s oracles so more long-tail assets can be listed

Governance

Isolated and permissionless pools

Integrations with other Solana DeFi protocols

We’ve been blown away by the interest our community has taken with Solend, and will continue working hard to deliver the best lending protocol.

Yours truly,
Solend team

Source : Solana Medium

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