Proposal: Whitelist SPELL token (SPELL) Plus 1M BNT Co-Investment Limit

DAO Archive (SUBMITTED)
1

This proposal is expected to appear on Snapshot for voting on 2021-10-11T12:00:00Z . Make sure to stake your vBNT for voting before this date and time to participate in the DAO decision.

TL;DR

  • Proposal to whitelist Spell Tokenn (SPELL).
  • Proposed co-investment is 1M BNT.
  • There are no apparent security concerns that would prohibit whitelist status.

Token Address: 0x090185f2135308bad17527004364ebcc2d37e5f6

Project Website: abracadabra.money

Token Security

SPELL does not have an elastic supply or rebase mechanism. The token contract appears to implement the standard openzeppelin libraries

The total token supply was initially 420B tokens and it was later cut in half to 210B SPELL. The current circulating supply is 59,889,900,619

The top 10 holders of SPELL are all contracts and the highest concentration of SPELL tokens are the spell contract itself (rank 1, see note below), Proxy contract (rank 2), sSPELL for those staking SPELL on the platform (rank 3), Sablier for streaming tokens to team members? (rank 4, 5), Arbitrum bridge (rank 6), Anyswap (rank 7), Sushiswap (rank 8), Curve/Convex Rewards (rank 9, 10)

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Note Rank 1: The total Supply of SPELL has been reduced from 420B SPELL to 210B SPELL by performing a unique token burn event. 210B SPELL was minted to the SPELL contract itself. The contract has no way of accessing these tokens which ultimately turns the Token Smart Contract into a Burn Address.

Project

Abracadabra.money is a lending platform that uses interest-bearing tokens (ibTKNs) as collateral to borrow a USD pegged stablecoin (Magic Internet Money - MIM ), that can be used as any other traditional stablecoin.

Currently, a lot of assets, such as yVaults have locked in capital that can’t be put to further use. Abracadabra offers an opportunity to use it.

Tokenomics

Abracadabra has 3 main tokens.

  • SPELL : the protocol’s token which is used for incentivization.

  • sSPELL : obtained by staking SPELL tokens and used for fee-sharing and governance!

  • MIM : a USD pegged stable coin

SPELL Token Distribution:

  • 63% (132.3B SPELL): Gloabl Farming Incentives

  • 30% (63.0B SPELL): Team allocation (4 Year Vesting Schedule)

  • 7% (14.7B SPELL): Initial DEX Offering

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SPELL tokens are distributed as follows:

  • 63% of the total supply will be used to incentivise particular LP pairs or other liquidity mining programs. Read more about the weekly allocation of SPELL incentives in the following section! A 10 Year halving model will be followed, which will cut in half the rewards distributed every year.

  • 7% of the total supply has been distributed via an IDO, half on Uniswap v3 and half on Sushiswap.

  • 30% of the total supply is allocated to the team members which is vested as follows:

Community and Communication

The abracadabra team operates an official Twitter and medium account. The repositories for their code is hosted on GitHub. There is a Telegram and Discord channel that is available to their community. The official documentation is hosted on GitBook. There is also a snapshot space that’s available to their community members for governance.

Available Audits

None that I could find at the moment but given the the 1.2B MIM (stablecoin) in circulation and the adoption in DeFi protocols inspires a lot of confidence.

Market and Trading Data

  • SPELL price at the time of writing is $0.01492532
  • All-time high: $0.01534594 (October 9, 2021)
  • All-time low: $0.00029812 (August 5, 2021)
  • Price 90 days ago: $0.0008
  • 59,889,900,619 tokens in circulation
  • 210,000,000,000 maximum supply.
  • The current market capitalization is $894,041,888
  • Token Fully Diluted market Capitalization is around $3,134,899,117
  • The SPELL token is available on DEX (Uniswap, Sushiswap, and Trader Joe)
  • The highest 24-hour volume on DEX (Sushiswap) is around $42M.
3 Likes
2

Thank you for the quick reaction and posting this. Spell has been very successful recently so it makes sense to collect some of that volume.

Would be nice to know if we should expect some public announcement from their team about the whitelisting.

1 Like
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I would like to add some obvious but thusfar unmentioned synergies to this proposal.

1] Becoming the main liquidity pool for the SPELL token. The SPELL protocol is growing at a breakneck pace, and price reflects it. As a result of that, providing liquidity for the SPELL token is currently highly undesirable. As the price of SPELL keeps outperforming ETH by a significant amount, ETH:SPELL LPs get absolutely rekt by impermanent loss and lose a lot of SPELL tokens.

The main liquidity pools are on Sushiswap which as the deepest liquidity, and Uniswap (yuck).
Stats for mainnet Sushiswap look like this:

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There’s about 3 times as much volume as liquidity available, and 24hr swap fees earned are equal to 1% of the available liquidity.

It we make the BNTSPELL pool the best swap pool available with the deepest liquidity, we can generate a sufficient amount of fees to make it attractive for SPELL holders that wish to increase their stack. Staking APR for SPELL is about 25%, I’m pretty sure we can beat that with swap fees. The BNT from LM will be a very nice bonus on top of that.

2] As we know Bancor v3 will consolidate all the LP positions of a wallet address into a single position. What’s more, the (currently hidden) LP tokens will become visible in the wallets of LPs on Bancor.

What are Bancor LP tokens? Right, interest bearing tokens. What can interest bearing tokens be used for? Minting MIM!

This integration would allow even Bancor users that don’t deposit BNT tokens to benefit from a vBNT-like mechanism: they can put to work a portion of their locked up funds while still generating interest through Bancor. I feel like this is an enormously natural and mutually beneficial synergy for both protocols.

It would be absolute insanity not to pass this proposal, and we should potentially even raise the co-investment.

tl;dr

SPELL LPs won’t get turborekt by IL
:handshake:
Bancorians can enjoy a ton of swap fees
AND benefit from an additional vBNT-like benefit when v3 is released.

3 Likes
4

Thanks for the reply.

I agree and I think the current starting amount will be a good indicator for how much appetite there is from spell holders for single sided liquidity provision. There is some risk with exposing the protocol to IL if we make this pool very large but I think that at this point price discovery has already happened and we are in the clear at the moment. We can certainly encourage the growth of this pool via BNT LM but I think the community would only favor that if we can either do a dual LM campaign between us and abracadabra (once V3 is released) or potentially some sort of buyback mechanism (see harvest who put their treasury in the BNT-FARM pool and also uses it for their buyback mechanism)

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100%, I was already thinking about this as well and not only with MIM but with other protocols as well. We will have better composability once V3 is out and pursuing this in the abracadabra DAO is worth doing.