Olympus Review

What is Olympus?

Olympus is a decentralized reserve currency protocol based on the OHM token, which is not pegged to any fiat money, instead, it relies on the basket of crypto assets and various parameters set through the governance. Olympus is run by OlympusDAO, which is a network of 150 community members who make strategic decisions related to the protocol.

The ultimate goal of the Olympus protocol is to create a decentralized, censorship-resistant reserve currency for the emerging Web3 ecosystem. The platform has been initially built on Ethereum and then expanded on Avalanche, Arbitrum, Polygon, Fantom, Moonriver, and Terra.

How does Olympus work?

Treasury is the key component of the Olympus, which uses economic incentives to control the supply and price stability of the OHM token. This treasury consists of stablecoins, which back the OHM tokens, making sure that the minimum value of one OHM is one DAI. If the value of OHM falls below one DAI, the protocol buys back and burns some OHM tokens to reduce its supply and stabilize the price, meanwhile if the value of one OHM rises above one DAI, the treasury mints and sells them. This way, OHM’s value is backed, not pegged. The value of OHM can rise above one DAI, but cannot fall below it. When the protocol mints new OHM tokens, 90% of them go to stakers and 10% go to the treasury.

To maintain the solvency of the treasury, Olympus deploys bonding and staking mechanisms. Bonding is the process of buying liquidity from the users in exchange for OHM at a discounted value. Olympus bonds have flexible vesting period options and the bonder's profit would depend on OHM price upon the bond maturity. 

Staking is another primary value accrual strategy of Olympus. Users who stake their OHM tokens are removing the OHM from market circulation and injecting them back into Olympus, thus contributing to OHM’s price stability. For doing so, stakers are rewarded with additional OHM tokens and the right to govern the protocol. In addition, their tokens are automatically rebased every eight hours bringing additional value to users. The wrapped equivalent of the staked tokens will be gOHM, which can be lent out, sold, farmed, or exchanged on other DeFi protocols.

Users wishing to obtain the staked OHM tokens or bond can use the Olympus OlyZaps function, which enables exchanging assets into gOHM or a bond in a single operation through the Olympus App.

As part of the recent migration to V2, Olympus has introduced some novel options in its ecosystem, namely Inverse bonds and Olympus give. Inverse bonding is the vehicle to maintain the OHM price and mitigate market volatility. It is the opposite mechanism to regular bonding, as it involves the exchange of OHM to treasury assets. Olympus Give allows stakers to redirect their rebase rewards either to pre-selected charity causes or to any wallet of choice. 

How to use Olympus?

Before interacting with the Olympus app, users need to connect a wallet. Olympus wallet support includes Metamask, Coinbase wallet, and Wallet connect. 

Users wishing to buy bonds have to navigate to the “Bond” section from the main page, which will display the list of available bonds to purchase. The user needs to choose the stablecoin, to be provided in exchange for the OHM token, then type in the amount of assets to be bonded. If this is the first purchase, the user needs to approve the Olympus contract to spend the provided assets. The user needs to click “Approve” and sign the transaction. After the approval transaction is successful, the button changes to display “Bond”, which should be clicked to confirm the transaction. 

For staking, the user needs to head over to the “Stake” section, enter the amount of OHM to be staked in the input field or press the “Max” button to stake all available OHM balance and confirm the operation by clicking the “Approve” button. The staking video tutorial can be found here.

The OMH token

The OHM token is both the protocol's stable currency and governance token. The token was introduced in March 2021 under the Olympus Fair Launch Event with a total supply of 68,260. 50,000 of the OHM were allocated to members who joined the Olympus Discord channel before March 3, 2021, and the remaining 18,260 were reserved as initial liquidity.

OHM tokens can be minted or burned only by the protocol, which is made in response to the token price fluctuation. OHM can be staked, to receive the rebase rewards and take part in the protocol’s governance through a DAO. Any member of the community can create a proposal on the forum for discussion before being posted to snapshot for a governance vote.

Is Olympus safe?

Olympus runs a Bug Bounty Program with Immunefi with a reward of up to $3,333,333. The protocol’s smart contracts are open source and can be reviewed by the community. 

Olympus was founded by an anonymous team and their leader who names himself Zeus also known as OhmZeus. The team behind Olympus claims that it was inspired by the ancient tales of Mount Olympus and the magnificence of mythological heavens. Zeus acts as the spokesman in the media in terms of the protocol-related issues. Zeus used to own e-commerce business and was engaged in equity trading. He started his crypto journey in 2017 when he got interested in arbitrage, later on, he got into trading with BitMEX.

Partners 

Olympus Pro is the bond marketplace for protocol-owned liquidity. This product offers the DeFi projects the liquidity services through the same bonding mechanism which Olympus applies Since its launch in September 2021, Olympus Pro claims to have onboarded 40 partners across four different blockchains and layer 2 solutions, including Ethereum, Avalanche, Fantom, and Arbitrum. In total, OlympusPro helped projects bond over $45,000,000 in liquidity and has generated over $2,000,000 in revenue for the OlympusDAO treasury. Olympus Pro has already been used by several leading DeFi protocols such as Frax, Klima DAO, Redacted Cartel, Lobis, Rome, Alchemix, Dopex, Inverse, Tokemak, Umami Finance, Debt DAO, Vesta, Volt, Exodia, Liquity, Phantom DAO, Prime DAO, Spirit Swap, and Fiat DAO.

Olympus has also recently launched an Olympus Grants program whose goal is to support projects that stand by the DAO’s initiatives but don’t fit into existing projects.  Olympus grants will focus on education, infrastructure, and utility. The grants aim to expand the Olympus ecosystem and support the core values of OHM such as building an inclusive economy. The Olympus grant program was initially funded with $1.5M from OlympusDAO. Projects wishing to apply for a grant can fill in the form here.  

Another recent project of the protocol is Olympus Incubator. The goal of the project is to accelerate the Olympus economy through the funding of new protocols that use or build on OHM or other Olympus products. The Olympus Incubator application form can be found here.

What’s next?

According to the Olympus 2022 roadmap, the protocol aims to promote the mass adoption of its ecosystem through CEX listing, bringing real-world utility to OHM through integrations with various protocols, integration into GameFi, and other metaverse projects.

Another major plan is to launch Olympus Odyssey, which will be a sub-DAO of OlympusDAO aiming to build a liquid secondary market for NFTs as part of the Olympus ecosystem.

Links

https://docs.olympusdao.finance/main/basics/basics

https://forum.olympusdao.finance/