Bumper Finance’s eagerly awaited liquidity provision program has now launched. Day 1 investors are already steaming in to take advantage of the superb APR on offer for those participating. The innovative protocol aims to calm the nerves of crypto investors by offering a unique set of protections against asset volatility. It hopes to empower holders of crypto by offering a safety net under their portfolios, and by doing so bring a sense of certainty to the occasionally wild DeFi market.
Uncertain Times Impact Crypto Holders
As crypto still finds its place in the world, asset values still shift dramatically on the daily. There has been plenty of retracement and consolidation over the last three months since April’s reckoning, and analysts and observers disagree on the current direction of travel. Some believe this is a pause in the music before the Saylor super-cycle rumbles on, while others feel that further severe drops are bound to happen before the market starts bubbling up again.
In this uncertainty, DeFi protocols are hit particularly hard – and many users have suffered impermanent loss as a result of the fluctuating asset values of the last few months. It can be frustrating for the communities building profitable yield farms to find their hard work turn to dust as a result of a single tweet, and many are looking for a way to counter asset volatility not just for their own portfolios, but for the wider crypto space – so that the utopian vision of a decentralized financial system is lost on the winds of chaos that occasionally tear through it.
Bump up the Security
Enter Bumper Finance, a DeFi price protection protocol that insulates crypto assets from severe price drops for those involved. On the Bumper protocol, users can choose to protect their assets for up to 95% of their value by paying a premium. Ethereum will be the first offered on the platform, and can be guaranteed in USDC. So, if April happened again, it wouldn’t cause so many knock-on effects to holders of protection. Indeed, by cashing out their policies tactically, users can even make excellent gains by taking that USDC and deploying it into other assets.
Premiums paid by users are distributed to those who provide the USDC liquidity that protects the assets. It gives investors who are currently holding onto stablecoins a chance to earn superlative interest on those holdings while they wait for the market to choose its next direction. Yields are paid out in USDC and depositors also receive the protocol’s native $BUMP token for engaging with the protocol. The $BUMP token is also the governance token that allows users to help direct the future of the protocol and which can be sold on the open market.
This diametric collaboration between takers of protection and makers of liquidity means both sides of the pool are heavily rewarded for their involvement. Takers can sit pretty knowing that their assets are not only protected, but that they can have all the benefits if the market chooses to rise. This is because, aside from having to pay the premiums, their representative assets will still capture price gains. Makers, on the other hand, get excellent return on their USDC investment and can have a large role in the growth of the protocol as larger and larger asset pools are insured.
Earning Rewards Through the Liquidity Program
Until October 14th, people can get involved in the liquidity program through the Bumper dApp. There is a sliding scale of rewards depending on how early investors get in. If you’re involved out the gates, not only do you get to farm $BUMP at 100% APR, but also have access to a private sale of the token before the public sale – pegged at $2.40. USDC deposits will be able to buy 20% of their deposit side in $BUMP at this private sale price. At these rates, a spectacular 300%+ APR is achievable in a short 3 month time frame, depending on community interest.
It’s certainly been a rocky road for crypto over the last few months. With governments sharpening regulatory knives while a simultaneous horde of retail investors pile in for a piece of the action, even more violent swings are expected as the burgeoning crypto market finds its place in the world. Bumper Finance directly addresses these issues in the DeFi space. The team markets it as “God-mode for crypto,” and the fact that users can have their crypto and eat it too is certainly a compelling offer. With their protocol minimizing risk for takers and rewarding makers so handsomely, it feels like, thanks to $BUMP, the road ahead might not be so bumpy after all.