Olympus DAO Ecosystem - A new force in DeFi 2.0

Overview of Olympus DAO

Olympus DAO The Protocol develops a treasury-backed currency called OHM. The collateral for OHM is very diverse, be it altcoins (ETH), stablecoins (DAI, FRAX), can also be LP tokens (OHM-DAI LP),…

Thanks to the collateral in treasury, Olympus DAO ensures OHM tokens will not depreciate like those stablecoins in the market.

In addition, Olympus DAO also developed a unique economy based on Game Theories, through two mechanisms, Bonding and Staking.

Why is it called the Olympus DAO Ecosystem?

Olympus DAO is a very popular project recently when it comes to providing a high and stable source of APY, the product of Olympus is the OHM currency – a currency guaranteed by the treasury.

With only 1 OHM product, Olympus DAO will only stop at the level of 1 Protocol, but recently, in the Olympus Community Forum, ChefOmi – a member of the development team, introduced OhmieSwap – AMM dedicated to OHM coins.

In addition to the AMM feature, OhmieSwap also plans to develop lending feature so that users can use leverage when using OhmieSwap.

With 3 basic pieces:

Stablecoin: OHM.
AMM: OhmieSwap.
Lending: It will be rolled out soon.

Olympus DAO clearly has ambitions to transform itself from a Protocol to a complete Ecosystem.

When writing about the Olympus DAO Operating Model, I said that Olympus is a big force in DeFi 2.0, and with this move, olympus DAO’s ambitions have been more clearly confirmed.

And when it comes to moving from a Protocol to an Ecosystem, there’s a lot of things Olympus DAO has to do, just like you used to manage only one company, now you have to manage a system of many companies and are closely linked. This will also open up many investment opportunities on Olympus.

This article will help you shape Olympus and the ecosystem they are targeting.

Mission of Olympus DAO

Olympus DAO has a mission to bring a “truly decentralized currency” to the crypto market.

You can think that in the market there have been many Decentralized Stablecoins such as DAI, UST, FRAX, LUSD,… but what these stablecoins have in common is peg with $1, and the USD is controlled by the Fed, so there’s still a “Centralized” factor in these stablecoins.

Olympus DAO wants to develop a “really decentralized currency” that is similar to Bitcoin, but is managed in a regulated manner by DAO communityIn other words, Olympus DAO is a central bank, issuing ohm coins.

The difference between Olympus DAO and fed is that Olympus DAO is administered by a DAO community, which creates decentralization in ohm’s organization and value.

This mission goes through the stages of development and the future of Olympus DAO until OHM truly becomes a “currency” in the market.

Highlights of Olympus DAO

Speaking of Olympus DAO, we have a lot to say.

First, Olympus DAO was initially successful in its ideals, as shown in olympus DAO’s Market Cap. At the same time, more than 30 projects have been forked from Olympus DAO, showing that this is the most effective model, few projects go fork from the runner-up instead of the first place.

Second, Olympus DAO has built a win-win community, to survive and grow, Olympus DAO has invented a Game theory (Game Theories), and in theory, to win this game, all must also agree, which will create resonance and increase value for all parties.

Third, there are many good ideas invented by Olympus DAO, especially the concept of Protocol-own-Liquidity, which solves a lot of liquidity difficulties in the DeFi market.

Finally, Olympus DAO is building an entirely new ecosystem on Ethereum, the ecosystem around the OHM coin, OHM will be at the heart of every Olympus product instead of ETH, in the same way terra developed the UST coin instead of LUNA.

Stages from “Protocol” to “Ecosystem”

Pham Nhat Vuong once said, “If I keep thinking I’m small, I’ll never get to saturation.”

Olympus DAO also has that spirit, from an early idea, to a market cap of $4 B, to reaching the TOP 50 Market Cap, thinking olympus DAO will slow down and stabilize, but no, the project wants to continue to break through.

Olympus DAO’s journey to date can be divided into 3 main stages.

Phase 1: Test from the market (3/2021 – 5/2021)

This is the period when Olympus DAO made the idea of “Decentralized Currency” a reality. Before that, this idea was implemented by you. Algo Stablecoin Other such as BAS, ESD,.. However, most of them failed.

After the first 2 months, it seems that OHM will be the same as the previous Algo Stablecoins, having plummeted more than 80% from a peak of $1,300, to $300/OHM. However, OHM differs from previous Algo Stablecoins in that OHM has intrinsic value, which is the project’s Treasury, which helps OHM never fall to zero.

Phase 2: Proving effectiveness and development (6/2021 – 10/2021)

Personally, I found that the test was a good thing for OHM to select members who believed in the project because of Olympus’ design according to Game Theory.

Having removed the speculative components, the rest of the people agreed to follow the motto (3, 3) of the project, at this time OHM is true to the strategy of a stablecoin, which is that the price does not fluctuate sharply, but the OHM supply increases rapidly.

OHM gradually received the attention of investors and returned to the old peak of $1,300, but now the market cap is $4 B compared to $20 M by April 2021.

After this success, many projects have forked Olympus DAO on Ethereum and other chains, as to prove, Olympus DAO is the most effective stablecoin Algo model today.

Phase 3: Breakthrough into an Ecosystem (11/2021 – future)

Following the announcement of OhmieSwap and OhmieLending in early November 2021, Olympus marks the transition to a new phase, which is an Ecosystem.

You can compare Olympus’ ecosystem with that of Sushi, Yearn, or Uniswap V3, which all develop a variety of interconnected products, but the difference lies in the central product:

Sushiswap / Uniswap: The main product is AMM.
Yearn: The main product is yield aggregator.
Olympus: The main product is OHM Stablecoin.

Next, we’ll get to know the key pieces of the puzzle in the ecosystem that Olympus is aiming for.

Puzzle pieces in the Olympus DAO ecosystem

OHM stablecoin

OHM is the first piece of the puzzle and the most important piece of the puzzle in the Olympus DAO ecosystem.

Although not peg for $1, OHM has secured assets, which creates intrinsic value for OHM and is accepted by the community. OHM’s capitalization has now reached $4 B, on par with other major stablecoins such as UST, DAI, MIM.

However, compared to the capitalization of USDT and USDC, OHM is still too small, which is why Olympus wants to develop further, realizing its mission to become the “Decentralized Currency of the Crypto World”.

Olympus Pro

Olympus Pro is a product that applies Olympus DAO’s model to sell Bond to other projects, thereby helping the project to gain a healthy source of liquidity.

Olympus Pro’s operating model is similar to olympus DAO’s Bond models, which use the project’s LP token, for example FRAX-WETH LP, to buy FXS at a discounted price (5%) after 5 days.

This is a unique, highly innovative product in the market, as well as a tool for Olympus to connect with DeFi 2.0 projects.

Olympus Pro has already sold Bond for 11 projects with a total bond value of $12.4 M.

OhmieSwap

OhmieSwap is one. AMM Fork from SushiSwap, whose native token is OXS, OhmieSwap was built to accelerate the development of OHM

Specifically, OhmieSwap will be the AMM taking OHM as the center, connecting all pools, trading pairs will be tied to OHM, for example ETH- OHM, FRAX- OHM, PENDLE – OHM,… Instead of eth like other AMM’ s.

Highlights of AMM OhmieSwap compared to other AMM’s:

OhmieSwap will be a powerful tool to support OHM’s development, native oxs tokens will bring many incentives to OHM holders.
Taking OHM-centricity will push the need to buy and use OHM more.
OhmieSwap will initially have a large amount of liquidity from OHM LP including OHM-ETH, OHM-DAI on Uniswap, estimated to be more than ~$500 M.
OhmieSwap can take advantage of partner sources from Olympus Pro, after selling liquidity to partners, can cooperate for them to create pools on OhmieSwap.

In short, OhmieSwap is an AMM developed on the background of Olympus DAO, taking advantage of many of the advantages available from Olympus as mentioned above. The stronger the OHM, the stronger OhmieSwap will be.

Ohmie Lending

Ohmie Lending is the name I gave myself to the feature. Lending on OhmieSwap.

In the early stages, Ohmie Lending will focus on supporting the OHM staker. Specifically, after the OHM stake and receiving the sOHM, you can mortgage sOHM on Ohmie Lending to borrow Farming leverage on OhmieSwap.

This product will help you optimize your capital more, both farming has leverage, and receive OHM Staking rewards. In return, you have to split 10% of the OHM staking reward to Ohmie Lending.

The pieces are coming.

After the launch of OhmieSwap, it can be seen that Olympus’ goal is to create more ohm demand in the market.

With AMM, Lending, Stablecoin as the foundation, the future will have other pieces such as Launchpad, Synthetics, Derivatives,…

Future projection of Olympus DAO

Here are some of his reviews and projections on the future of Olympus DAO.

In the direction, I think OHM is on the right track of an Algorithmic Stablecoin, which will prioritize ohm’s use case development before ⇒ consider the following stability, which is the lesson learned from the previous Algo stablecoins, when they were too focused on stabilizing peg with $ 1.

In terms of feasibility, developing an ecosystem has never been easy, such as developing an AMM, to develop a complete AMM full of trading pairs on Ethereum is now too difficult, as other AMM’s have come a long way.

Therefore, I think that AMM Ohmieswap will only serve the OHM ecosystem and DeFi 2.0 projects. Not except the possibility that OHM will do more Aggregators to compete, but this possibility is low, as such will lose the substance of the OHM currency.

In terms of impact, Olympus is at the forefront and a breakthrough in this market, a strategic shift to an ecosystem that will help Olympus outpace fork projects, as the Uniswap V2 moved to uniswap V3. Olympus wants to grow. Cross-chain, bring ohm coins outside the Ethereum framework, so the opportunities for fork development will be less.

Finally, we talk about the consequences of the strategic move from Olympus, in our opinion:

Ohm price will have to be more stable than before, since if ohm fluctuates sharply will cause innocuous losses (IL), the LP will withdraw liquidity.
OHM supply must also increase steadily to cater to the need for more liquidity and swaps, less supply will push ohm prices up, not good. Therefore, I think APY staking OHM will stabilize and decrease little.
OXS will be the token that will benefit greatly from ohm’s development. Specifically OXS holder will receive: transaction fee and 10% rebase fee of sOHM mortgage.
After AMM, Lending, Stablecoin, Olympus will continue to develop more products such as Launchpad, Synthetics, Derivatives,… To form a complete ecosystem.

See ya in the next article !

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