Hegic – a permissionless options protocol – is currently conducting its token distribution through an Initial Bond Curve Offering (IBCO) which started earlier today and is set to last until this weekend.

This token sale is meant to offer a more fair and open launch. The IBCO ensures that everyone receives the same settlement price regardless of how early or large their purchase is. All pooled contributions are put in the same batch and the token price increases with every purchase. With the Hegic IBCO underway, it’s a great time to better understand what the protocol actually does and token holders will be able to do once they have HEGIC in hand.

What is Hegic?

Hegic can be thought of as an automated market maker for options, enabling users to trade non-custodial call and put options without having to signup or KYC. The protocol enables liquidity providers to easily earn a return by selling call and put options to the Hegic marketplace. The trading protocol will go live on October 10th after their current security audit is completed by PeckShield. Here’s a look at the project roadmap.

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Token Distribution

The total supply of HEGIC is set at a fixed supply of 3,012,009,888 tokens broken down as follows:

  • 20% (602,402,000 HEGIC): Early Contributors
  • 10% (301,200,988 HEGIC): Hegic Development Fund
  • 40% (1,204,809,000 HEGIC): Liquidity M&U Rewards
  • 25% (753,001,000 HEGIC): Bonding Curve
  • 5% (150,596,900 HEGIC): Balancer Pool

Note that after the initial token distribution announcement, the lockup period for early contributors and the Development fund were both increased substantially.

 

Staking with Hegic

Settlement fees on Hegic are paid in ETH and WBTC each time an option contract is bought and distributed among active staking lot holders. Staking lots can only be activated by Hegic token holders with a minimum of 888,000 tokens. When staking HEGIC, the minimum lock-up period is 30 days.  Settlement fees are set at 1% of each option size in ETH and WBTC. After requesting a withdrawal from the staking contract, there is also a waiting period of 7 days before tokens and rewards can be withdrawn.

Liquidity Mining Rewards

Hegic’s liquidity mining program has 3 phases starting in September 2020 and ending in November 2023. Each phase lasts exactly 12 months and will distribute rewards to both liquidity providers and options holders. There are also specific milestones that must be hit for each phase before the reward tokens are unlocked. See the below image for a breakdown of Phase 1 Rewards.

The rollout of Hegic serves a strong testament to the project’s evolution following a bumpy start. The aforementioned blog posts also shine a light on an 80/20 Balancer liquidity mining campaign to see secondary HEGIC liquidity after the first four weeks of the sale.

To stay up with the project follow Hegic on Twitter.