2022 is the year of governance. With DeFi 3.0 right around the corner, AMMs are turning into multi-billion-dollar endeavors that build the infrastructure of financial instruments in DeFi. They are the roads that decentralized finance needs. Governance protocols in AMMs allow users to vote on LPs that the AMMs will invest in, with great allocations for those who hold immense votium.
But, there is one issue – To be able to vote, you must lock your tokens for a long period of time, usually 4 years, with a very little yield to make up for the escrowed tokens. These protocols are populated with numerous whales, VC funds, and protocols that need liquidity, which take a huge slice of the cake, whose crumbs are left for the average user of the protocols. This is where Sphere Finance comes in.
Sphere Finance aims to take a hold of governance protocols in a way where the average investor can enjoy the amazing world of governance without locking away their investments, which on their own cannot make a big profit – effectively gathering a community of investors with a common goal that band together and become one whale, effectively bringing back DeFi to the people.
Basic mechanics
Sphere Finance is a project with an autorebasing token that is backed by a basket of assets, mainly governance tokens, which continuously appreciate in value, thus raising the longevity of the token. SPHERE, our main token, is a token that automatically is staked and yields a daily 1.91% just by holding within your wallet, rebasing every 30 minutes. These emissions are supported by a taxation system that requires you to pledge an amount of your investment into the treasury which is used to fund liquidity, hedging & investments.
The amount is set at 13% & 20% on buying and selling respectively, which will ensure both long-term holding, a steady stream of income for the protocol & ample liquidity for our listed pairs on DEXes. Sphere is an incredibly simple financial instrument. To use it, all you have to do is just buy & hold the token. It automatically yields rewards in your wallet without any further work needed, to ensure that you will capture all of the governance benefits without having to lock up any tokens. This effectively turns an illiquid market (escrowed tokens) into a liquid one, by allowing you to have a share in a constantly yielding vault that pays dividends regularly without having to lock up your investments.
To further promote this easy-to-use protocol, they’re going to be going multi-chain, the first target being the BEP20 chain. As expected, their Gravity Bridge service will be used in-house, in the website with only 3 clicks needed to bridge your tokens to and from Polygon & BSC. You can only bridge the tokens in the form of DYSON tokens, which are an upcoming wrapped SPHERE token.
The DYSON token will be fully available via the decentralized app in the second version of the protocol. It may be off-putting to some that there are taxes, which would imply a direct need of volume in trading. However, Sphere Finance has come up with a revolutionary way of yielding their liquidity pool to earn even more liquidity, with the help of their partner, Tetu Finance. The so-called Quantum liquidity is still in development as of now.
Taxes
Sphere Finance has a stock tax rate of 13% & 20% on buying and selling respectively, with transferring tokens having a 13% tax as well. The taxes are divided into the following:
3% – 5% will go towards the investment treasury which will be used to acquire more governance, buy into a variety of different cross-chain endeavors, fund OTC deals with projects to acquire large sums of appreciating assets at a discount & high-risk degen plays. All of the following will fund the protocol in the long run.
5% on the LP to ensure ample liquidity when buying or selling.
5%-10% Risk-Free Value, which will hedge against volatility in the market to ensure stability in the price of SPHERE.
This is a set-in-stone tax that everybody must pay upon staking the tokens.It is a revolutionary way to ensure that there is a way to fund rebases without issuing bonds that inflate the circulating supply. The system turns SPHERE into an appreciating asset whose longevity is approved and supported by the community, to keep the trend of dividends flowing.
However, even if the taxes may be considered steep to the average investor, it isn’t enough to scare away actual whales from buying into our endeavor and attempting to manipulate the price, which brings us to the Dynamic Tax, reviewed & approved by the Spherean community. The Dynamic Tax is a loose term for a system put in place to evaluate how much somebody should be taxed based on their share in the Sphere ecosystem.
In a regular autorebasing project, most of the time, the investors, no matter their price impact, pay the same tax, which creates the issue where a whale can comfortably afford to pay the taxes in exchange for huge volatility that shakes off ordinary holders, thus allowing for a buy at a discount that gets abused. To remove incentive from playing price manipulation, an additional 5% to the sell tax is added for every % of the LP the holder holds.
1% -> 5% additional tax
2% -> 10% additional tax
3% -> 15% additional tax
so on and so forth…
Until the holder has to sell with a 70% tax on their transaction, all of which will be used to fund the protocol & reward the stakers. It also incentivizes stakers to continuously take profits to ensure a healthy ecosystem that benefits from the sheer volume of the token & keep emissions running smoothly. DeFi is for the people, so Sphere wants to protect the average investors, who are the majority of their community & the DeFi space. To make sure they do this correctly, they’ve raised the initial sell tax to 30% which will decrease by 5% over the next 3 days, reverting back to the usual 20%.
Sphere Finance offers an equitable financial instrument that makes use of many different sources of income to generate revenue for a token that acts as a share in its ever-increasing treasury, like an index fund. Hence the title – the S&P 500 of crypto. When you hold an amount of SPHERE, you hold a direct % of the treasury, which works for you and the huge number of people who have a % of the treasury just like you do, that auto compounds itself in a way that retail simply cannot achieve.
Whether it’s by funding incentivized vaults in other protocols, handling OTC deals, automating the relocking of yield-bearing assets to maximize profits, or just the sheer volume of the liquidity provided in an illiquid space, Sphere Finance aims to accommodate the average investor into a world of finance that’s been overshadowed by many figures who wish to malevolently use their capital as exit liquidity. In a world where big volumes of liquidity simply get better results & are noticed & targeted by protocols, Sphere Finance wishes to give you, the average investor, a chance to enjoy that delight. The delight of finance in a decentralized space.
Finance is not the only thing Sphere Finance offers though, there are also the SPHERE Games.
SPHERE Games
SPHERE Games is a way to win huge amounts of tokens without losing your principle. A group of Sphereans agrees to put their rebases into a pool for a period of time. After the period ends, the winners are randomly drawn, and they get to share the winning pool’s funds. SPHERE Games is heavily inspired by and forked from the initial idea of PoolTogether, which used the same mechanic for sOHM. However, Sphere has built upon the idea by offering ways to also earn SPHERE even when you lose the draw.
The Sphere Faucet is a separate pool that yields your SPHERE at a much lower APY, at the cost of guaranteeing yields even if you lose the draw when you put your rebases into the lucky pot. By playing the SPHERE Games, you also agree to burn 10% of the rebases in the lottery pool to deflate SPHERE’s circulating supply, thus making prices more sustainable & easier to move upwards.
They’ve seen how easily someone could exploit the games by brute-forcing the RNG of the blockchain; therefore they’ve sought professional support from our friends at ChainLink. Sphere Finance has also adjusted the parameters of the Games to make sure that users stay in for the longest period of time by implementing a 30% tax for entering, which decreases over time. To top it all off, every 1% of every Lottery Pool will be collected and used for charitable events, whether it be donating to charitable organizations or helping individuals in need.
The contract with rebases & evaluations of holders is running continuously and automatically via Chainlink’s Oracle technology, which was generously offered to them by our friends @ Chainlink. This guarantees their continued emissions which will run smoothly forever, all powered in the Polygon ecosystem, by the Polygon ecosystem. This brings us to the topic of the Polygon Alliance.
The Polygon Alliance is a partnership of DeFi projects within the Polygon ecosystem, of which Sphere Finance is a founding member, whose purpose is to work together as one protocol, incentivizing each other to invest into different strategies which yield everyone involved profits, all the while raising the TVL on Polygon. The founding members are as follows:
Sphere Finance
Otterclam Finance
Universe Finance
Vesq
Tetu Finance
These 5 projects will act as one to create one big yield fund which will help each other gain governance over QiDAO, a Polygon-native AMM. With Polygon’s blessing, Sphere Finance will be taking part in all of the strategizing and implementation of the same in the alliance as every other member. The projects in question are a cog in a machine that needs many cogs & parts to keep moving and producing. They are a product that aims to take governance over a product, and once they are big enough, somebody will do the same to them, and it will benefit Sphere Finance’s protocol because it will allow them to increase their positions in their governance acquisitions.
Conclusion
In short, Sphere Finance is a project which aims to inspire other projects to work together to yield profits to their loyal stakers in a way where every investor can enjoy them just as much. It is a network of wallets that create one great society whose main fuel is profits maintained by a calculated, automated & complex algorithm that can sustain itself by itself. Become a part of the community now by joining either our Discord or Telegram.
Disclaimer: This is a paid post and should not be treated as news/advice.
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