Hey everyone, welcome to watch the live of AMA co-hosted by HyperPay and Flamingo. Welcome to join it and be free to ask questions if you have something unclear. We will sum up and answer them in the recap of AMA. Let’s start now!
Host : Nancy, Marketing Director of HyperPay
Guest: John, Head of Flamingo Eco-system Development
1. As we all know, Neo is one of senior public chains, and the incubation of Flamingo, is it the act of marketing or the need of ecosystem? Can you briefly introduce the Flamingo project to our community? How does it work, and what are its specific application scenarios?
John: Neo is a relatively senior project. Many projects of the same period have not survived. Neo has maintained iterations and updates, never been absent for every industry progress. At the very earliest, Neo has deployed on DeFi; there were stablecoins based on asset over-collateralization at the end of 2017; and DEX Switcheo and Nash have caused very good responses in the market.
However, we have to admit that he number of new assets on public chains other than Ethereum is actually declining due to many kinds of reasons, so we think any assets, even BTC or ETH, deserve to be treated well on the Neo chain. Flamingo is published with a goal to revitalize the existing assets on the chain while introducing low-utilization external assets.
Another very important reason for the advent of Flamingo is that the world is struggling with ether GAS for a long time. Neo was called the killer of Ethereum by overseas communities in the early years. Although we disagree with this either-or-competitive relationship, to a certain extent, it reflects the community’s expectations for Neo, then in this window of DeFi outbreak, we also want to try to write a larger DeFi story.
Flamingo is a full-stack cross-chain DeFi protocol cluster incubated by NGD, the operating organization of Neo. The early development, audit, and operation are assisted by NGD, and later it will be operated by the community to become a fully decentralized autonomous organization (DAO). With the gradual deepening of Neo’s layout in the entire industry and the continuous improvement of infrastructure, PolyNetwork, a cross-chain protocol initiated by Neo, was officially launched last month, which provides Flamingo with a larger vision — with lower friction, to provide higher asset utilization efficiency and build a community-governed cross-chain DeFi protocol cluster based on contribution distribution incentives.
2. How are the functions of Flamingo realized? Can you introduce the five components of the Flamingo full stack separately?
John: There are 5+1 modules in the Flamingo protocol cluster, and users who participate in these five modules will be rewarded with FLM tokens.
The 5 modules are,
Wrapper: cross-chain gateway
Swap: liquidity incentive/AMM-based decentralized exchange
Vault: asset management
Perp: perpetual contract trading
DAO: decentralized governance
The working principle of these five modules is included this picture,
External assets enter the Neo chain through Wrapper — provide liquidity to Swap to obtain fee sharing and LP token, LP Token be collateralized to Vault to generate FLM incentives — LP be staked to generate FUSD stable coins, and get FLM and incentives — FUSD to Perp as a margin for perpetual contract transactions and get FLM incentives. All FLMs can participate in DAO governance.
3. What is the design of project’s token economic model? How does Flamingo’s token FLM capture network value?
John: First of all, FLM token has no pre-mining, no pre-sale, no team distribution, and the distribution is 100% based on the participation for Flamingo project.
During the early stage of the Flamingo project, the FLM supply will be distributed to the following use cases, which will be subjected to proposals and changes by the community after DAO launches.
1. Staking of cross-chain assets (only for the first one-week “Mint Rush”)
2. Staking of LP tokens obtained by providing liquidity (After”Mint Rush”)
3. Minting of FUSD in Vault
4. Depositing of synthetic stablecoin FUSD as margins to trade perpetual contracts
5. Participating in DAO governance
The allocation curve for the first 13 weeks is drawn to the picture below
The value capture of FLM is that if users do not participate in Flamingo network, they are of no value. The depth and frequency of participation determine the level and amount of incentives. At the same time, the governance meaning given by FLM allows users to make proposals, vote, and then determine system parameters including liquidity pools that can be rewarded by FLM, transaction rates and other system parameters. It is even possible to make improvement proposals, allowing FLM to empower a DAO with internal infinity power.
4. I see that you are also about to launch DeFi liquidity mining. Can you share some information about it with us? Compared with other liquidity mining provided by other public chain, what are the attractive features do you have? What do we need to prepare for participation?
John: You can refer to the user guides of Flamingo and Flamincome, which details how to participate in the dual mining of Flamincoe and Flamingo as an Ethereum asset holder.
It is currently known that the total amount of FLM released in the first year is about 150 million, and 50 million will be released during MintRush from 9.25–9.30. The single-asset collateral method is used to obtain yields. The current plan is that NEO distributes 25 million FLM, wBTC 5 million, USDT 5 million, ETH 2.5 million, ONT 2.5 million, wBTC/ETH Uniswap LP 1.25 million, and other assets 17.5%.
5. The heat of DeFi has also lit the fire of chaos. Therefore, the security of the contract is an issue that everyone is very concerned about, and how does Flamingo guarantee the security?
John: Yield Farming, or liquidity mining, does not need to spend, but has to collateralize assets. Therefore, the security of the contract is our first priority. All of our contracts have received audit reports or are under audit. The audit report that has been obtained so far comes from Pechshield.
In addition to the support of partners, Neo’s underlying chain is relatively friendly, so developers can avoid pitfalls during development, and it is relatively easy to check and discover contract vulnerabilities, thus to say the security of the contract is under double insurance.
6. In order to attract the attention of Ethereum players, you designed Flamincome, called the ultimate yield booster. Can you specifically introduce its realization principle and operation process?
John: Flamincome is the Ultimate Yield Booster on the Ethereum network. In its initial stage, Flamincome will adopt the same strategy as other mainstream yield aggregators to provide Flamincome users with yields similar to YFI while safeguarding the staked assets.
In addition to the earning yield from staking, Flamincome users will also receive pegged assets corresponding and redeemable back to the value of their original assets that are staked for yields on Flamincome. This means that while staking their ERC-20 asset on Flamincome for yields, users can also use the pegged assets obtained from the Ethereum DeFi ecosystem (Flamincome) to participate in Neo’s DeFi ecosystem (Flamingo) and receive FLM.
7. At present, most DeFi projects are based on Ethereum, so yesterday’s plunge in ETH has destroyed many DeFi projects. Do you think the plunge of ETH is an opportunity or a challenge for you?
John: DeFi is a new force that will change the existing financial paradigm. For the blockchain world, there are both opportunities and challenges.
Swap on the chain is of great significance to the vitalization of asset liquidity. Based on Swap, stablecoins can be minted on Flamingo and be participated in perpetual contract transactions on the chain. Flamingo may become a revelatory practical case and bring some new thinking to the industry!
Besides, Neo is a digital asset protocol, having its own relatively mature smart contract system, a relatively large amount of assets, and a relatively active community atmosphere worldwide, which is a good fit with DeFi.
In the past, NF and NGD did not directly participate in incubating projects, but helped community projects in the form of funding. This time NGD’s participation is because DeFi requires some basic modules to start development, and time is running out. Neo3 will be launched around January next year. We need to understand the requirements of the application layer in order to do a good job of the protocol layer.
We also hope that this time we can better activate Neo’s communities and explore new directions.