fatfi

Feb 24, 2021

6 min read

An Entry-level Introduction of Fatfi

Fatfi is a DeFi Ecosystem, with our Algorithmic Stablecoin forked from Basis Cash protocol, with extra services. While several different designs of algorithmic stablecoins have launched, we believe that the Basis Cash design is the best out there. It’s proven to be resilient while also having the widest distribution of users.

Defi Summary

In 2020 the DeFi sector is booming and cryptocurrency users around the globe can make use of traditional financial services such as borrowing, lending, trading, and investing in a decentralized and transparent manner — with just an internet connection and a cryptocurrency wallet.

According to data compiled by DeFi Pulse, the US dollar value of ETH locked in DeFi protocols has grown from $674 million at the start of January to over $13 billion today — a 1928% increase in just 1 year. Compare this to 2019, when the value of ETH locked in DeFi protocols grew by just 130 percent over the course of the year, from $293 million to over $687 million.

As the Yield sector gets more robust, its architects will come up with ever more robust ways to optimize liquidity incentives in increasingly refined ways. We could see token holders greenlighting more ways for investors to profit from DeFi niches.

Market Problems and Our Missions

We believe permissionless yield for decentralized assets is here to stay. But with DEFI, we had passed a lot of milestones and still have a long way to go. Even crypto natives today struggle with the plethora of yield farming strategies available to them. The cutting-edge strategy is constantly in flux within yield farming sector. And with every new strategy, testing and research is time and money -consuming at a very high level.

Since the Algorithm Stable Coin revolution, the game had changed. Everything you had known about DEFI Yield Farming is “Inflation”, “Impermanent Loss”. With the success of Algorithm Stable Coin phenomenon, Fatfi want to leverage this sector to a higher level, which is much more sustainable and aim for investor’s long-term profit.

Fatfi is a decentralized open innovation platform that will foster a collaborative ecosystem, with the goal of dramatically accelerating the development and adoption of the world’s most advanced technologies & strategies into the most attractive segment in DEFIverse: Liquidity Rewards

Introducing Fatfi — a DeFi Ecosystem, with it own Algorithmic Stablecoin.

We believe permissionless yield for decentralized assets is here to stay. But with DEFI, we had passed a lot of milestones and still have a long way to go. Even crypto natives today struggle with the plethora of yield farming strategies available to them. The cutting-edge strategy is constantly in flux within yield farming sector. And with every new strategy, testing and research is time and money -consuming at a very high level.

Since the Algorithm Stable Coin revolution, the game had changed. Everything you had known about DEFI Yield Farming is “Inflation”, “Impermanent Loss”. With the success of Algorithm Stable Coin phenomenon, Fatfi want to leverage this sector to a higher level, which is much more sustainable and aim for investor’s long-term profit.

Fatfi is a decentralized open innovation platform that will foster a collaborative ecosystem, with the goal of dramatically accelerating the development and adoption of the world’s most advanced technologies & strategies into the most attractive segment in DEFIverse: Liquidity Rewards. We are the mixture of DeFi and Algorithmic Stablecoin.

Fatfi is built on Binance Smart Chain, bridged to Polkadot.

How does Fatfi work?

Fatfi is a DeFi Ecosystem, with our Algorithmic Stablecoin forked from Basis Cash protocol, with extra services. While several different designs of algorithmic stablecoins have launched, we believe that the Basis Cash design is the best out there. It’s proven to be resilient while also having the widest distribution of users.

Our protocol controls money supply similarly to how central banks of the world may guide the value of fiat money through monetary policy. By controlling the quantity of money supply in an economy by buying or selling bonds, a target value can be achieved (In this case $1). Instead of a central bank or a currency board, rules are set and executed programmatically via smart contracts so that behavior of the system can be predictable.

There are four tokens in the Fatfi protocol:

FAT Token — Our Governance token

FAC — Fatfi Cash: Our algorithmic stablecoin, designed to be used as a medium of exchange. The built-in stability mechanism expands and contracts their supply, maintaining the price of $1.

FAB — Fatfi Bonds tokens are designed to move in price and guide FAC to $1.

FAS — Fatfi Shares. Fatfi Share token holders will be the backbone of the system, providing resources and guidance to the protocol.

Stabilization Mechanism

When Fatfi Cash is below $1

When Fatfi Cash is traded below $1, users will be able to purchase Fatfi Bonds at a certain discount to establish the price stability of Fatfi Cash, with the expectation of future profits upon redemption.

Each bond promises the holder exactly 1 Fatfi at some point in the future under certain conditions. Whenever a user purchases Fatfi Cash, it is burned, causing a decrease in the circulating cash supply. Bonds do not have interest payouts, nor do they have maturity or expiration dates. Rather, they can be redeemed on a 1:1 ratio with Fatfi Cash when the price rises above $1.

Purchased bonds can be redeemed on a 1:1 ratio with cash only when the oracle price of cash is above $1. This prevents bondholders from cutting their losses on redemptions and creating unnecessary increases in supply.

When Fatfi Cash exceeds $1

When the price of Fatfi Cash exceeds $1, the contract primarily allows bond redemptions to bond redeemers. Even after the bonds are redeemed, if the price of Fatfi Cash is traded above the price of $1, an increase in the demand of Fatfi Cash results in new Fatfi Cash tokens being minted and distributed to Fatfi Share holders.

For instance, let’s assume that the price of Fatfi Cash exceeds $1 even after bond redemption. In this case, the Treasury contract mints new Fatfi Cash seigniorage into existence. This seigniorage is given to the Boardroom, where users can stake Fatfi Shares and earn daily seigniorage based on the price of Fatfi Cash.

Fatfi Products

1. Fatfi Algorithm Stable Coin

While several different designs of algorithm stablecoins have launched, we believe that the 3 tokens design is the best design out there. It’s proven to be resilient while also having the widest distribution of users. Fatfi Cash is a Algorithm Stable Coin protocol, but in a better version having Governence Token — FAT. Of course, one of the natural questions that many may have is: “Why would someone want to participate in Fatfi, instead of others?”.

With Others Algorithm Stablecoin, Users only earn the profit within the Expansion and Contraction of the protocol, which can easily come to a point that there is no more profit for users, because the main goal of a Stable Coin is stay Stable. Once the Protocol already come to that stage, without any further development of the project, the game is done.

With Fatfi, one can also participate in the Algorithm Stable Coin and earn rewards in the form of FAT tokens. However, unlike others, those FAT tokens will also entitle you to continue to earn a portion of the protocol’s fee, accumulated in FAT, even if you decide to no longer participate in the Algorithm provision.

2. Fatfi Defi Financial Services

A bank with no Financial Services is a Money Game, is not a bank. The main logic behind Algorithm Stable Coin is the logic of the demand and supply, demonstrate how the governance bank manipulate the money supply. Our strategy is not trying to create, new financial products. With the development of DEFI, there is a lot of good DEFI financial products out there. We aim to create an Integration Application for Fatfi product into other financial service out there in DEFIverse.

3. DAO

Fatfi will improve with several additions planned for implementation. New developments and respective budgets will be proposed via the Fatfi DAO. The community can decide on the development priority to fund and to be implemented in Fatfi. The DAO Reserve is planned to unlock by the 17th month.

Important Links

Website: https://fatfi.io

Telegram Announcement Channel: https://t.me/fatfichannel