On Monday 25th July, Astar hosted a Discord AMA with Algem’s CMO – Greg, and CTO, Arthur to explain how we plan to present the new liquid staking protocol on Astar to the community.
This also paved the way for the community to post their questions and let them have them answered by the team!
So without further ado, let’s dive in and explain more about it now!
So let’s just start with Greg, what is Algem exactly?
Now we know this question gets asked/mentioned all the time, however it is fundamental to really understand this and with all due respect to being transparent we always like to start off by saying this where needed.
Algem is an easy-to-use dapp built on Astar Network which unlocks the full profit potential of your Astar tokens.
I know that’s a strong claim, but the way that we do that is by letting you stake your Astar tokens and in exchange, you receive your staking rewards (as you normally would)
But you also receive a liquid ASTR token which we call nASTR, and with this nASTR token, you can use it to yield farm across the entire Astar Network ecosystem to maximize your earnings.
It’s pretty amazing!
So in essence, you get double the rewards with your ASTR tokens by staking and yield farming at the same time.
It’s fantastic for users, and there’s really nothing else like it on Astar Network at this time.
Who are we?
The History/experience/story of the team member in Polkadot / Astar ecosystem, and let’s also mention about ambassadors here too, Astar Degens and working in core team.
We were lucky to have gathered a high-level squad and now we have 8 permanent team members and 2 freelancers. Also, we have the full support and backing of the Astar Core team.
In terms of our founding team, we’re Polkadot and Astar maximalists through and through…
Igor and G, our two co-founders were Astar ambassadors so we’ve been pretty deep into the ecosystem for a while and we fully believe in Sota’s vision.
I, myself, also worked at Astar Network and have over 10 years of marketing experience.
So in terms of our non-technical team, we have a good mix of marketing, operational, and entrepreneurial backgrounds. And of course, as I said, we’re all Astar and Polkadot maximalists and that gives us a unique edge.
I’ll now let Arthur talk about the technical team.
We are a team of geeks and nerds. Although, to be honest, if I had to describe ourselves in a sentence, it would probably be “nerds with passion.”
I started my development journey years ago by developing microcontrollers, robotics algorithms, and embedded systems, moving into cyber security and blockchain tech, and getting engulfed by the sheer scope of things to do.
I’ve been launching products from defi solutions to NFT collections and teaching blockchain and cryptography to many students.
Cyrill, Alex, Dan, Igor, Val, and I are solidity, front-end, and security geeks.
We love taking stuff apart and putting it back together, finding solutions to problems that seem too obscure to start looking at. We take pride in creating applications that we are proud to show to our colleagues and are not afraid to show to our grandmothers.
How does it bring benefit to users? (I expect users can understand how the experience is different from normal staking) – Greg
Well initially, when we set out to build Algem, we were looking to scratch our own itch.
The problem that we currently face right now in most of the DeFi space is that we have to choose between staking or yield farming.
And that’s a problem because as users we don’t know what’s going to get us the best ROI – so we’re basically left guessing…
Furthermore, there’s this idea of an opportunity cost associated with choosing one over the other.
What I mean by that is if I choose to stake, my opportunity cost is the earnings I’m losing by not yield farming, and if I choose to yield farm, my opportunity cost is the earnings I’m losing from not staking.
So what we’re doing is we’re removing this opportunity cost by creating a liquid nASTR token.
We call it liquid because when you stake your tokens you’re locked up and you have no liquidity.
So by creating the nASTR token we’re giving you the freedom to stake and yield farm simultaneously, we’re giving you flexibility, and we’re making it essentially possible for you to maximize your profit with your Astar tokens.
How to use nASTR in the Astar ecosystem and its future? –Arthur
The main goal of nASTR is to maximize users’ income with their Astar tokens.
So users can farm using their nASTR on various DeFi dApps, DEXes, lending protocols, etc.
We already have a partnership with all significant DeFi dApps in Astar Ecosystem.
The first DEX where you can use nASTR is Sirius Finance.
We will gradually add nASTR on other dApps (like SiO2 finance, Kagla, Starlay, Starfish, etc.) during August and September.
How does Algem bring benefit to the Astar ecosystem? – Greg
So our goal is to be the dominant liquidity hub not just in the Astar ecosystem but also beyond the greater Pollkadot ecosystem…
It’s fair to say we have BIG ambitions…
But that’s what we feel we can be…
And that’s the benefit we feel we can bring to the ecosystem…
We feel that users shouldn’t have to be locked up when they choose to put their tokens to work…
Also when Astar tokens get staked you could argue that they lose some of their utility for the users who stake them…
So the benefit that we bring to the ecosystem is token liquidity and utility, as well as flexibility.
Have you got an audit? From which firm? How do you see the security of Algem? – Arthur
We received our first audit from QuantStamp just before the launch.
Given the nature of blockchain technologies and especially decentralized finance, security is one of our primary concerns.
We at Algem strive to create practical, easy-to-use, and easy-to-understand products that are safe to use and can be relied upon.
We have worked hard alongside the absolute best blockchain security firm, QuantStamp, to catch as many bugs and potential vulnerabilities as possible before the launch.
I can confidently testify (having a certificate as proof) that we were successful in doing so. As a result, our product is entirely safe to use.
Security is an ongoing effort at the forefront of our minds.
We will always ensure that our products are up to the task before rolling them out to the community.
Do you plan to launch your native token? And what’s utility? – Greg
We’re planning on launching our native token, which we call ALGM in the coming months.
The main idea behind Algem tokenomics is that our token is the cornerstone of our app, and you need to actively use our token if you want to earn Algem’s protocol revenue as well as our partners’ revenues.
In terms of utility, Algem token is tied to three functions, which are: Liquid Lending, Algem Staking, and Voting.
In the context of Liquid Lending…
Algem accumulates our partner dApps’ lending rewards into these pools…
And the only way that you can earn a portion of these rewards is by staking and re-investing your Algem tokens into these pools.
The other utility is Staking…
The way it works is simple. You stake your Algem tokens and you get Astar token rewards.
Algem distributes 70% of its revenue (management fees, Build2Earn reward, etc.) to ALGM stakers.
The last utility is Voting…
The way it works is you can vote for dApps where Algem will supply ASTR tokens and then dApps receive ASTR tokens in proportion to their ALGM voting power.
Can users of Algem expect something like airdrop? – Greg
If you submitted questions prior to this AMA and your question was selected, then you’ll be part of the airdrop.
We also have a quiz and we’ve gotten over 20,000 submissions…
It’s super easy – takes about five minutes to complete, and we’ll leave the link here.
To be eligible for the airdrop, you need to score at least 12 out of 15 points…
What’s your roadmap. What kind of updates are expected?- Arthur
We have a pretty comprehensive roadmap and many new features to deliver. First of all, after the launch, we will work on liquid staking 1.5. In this upgrade, we will add an option to choose the dApp where you want to stake your ASTR. Currently all tokens are staked in Algem dApp. We are planning to deliver this feature within a month after the launch.
Our next big update is the Liquid Lending solution – a new feature for the whole crypto space. A quick reminder about this product:
With Algem’s liquid lending solution, users can stake their ASTR tokens in various vaults and earn incentives through a multi-level rewards system while remaining liquid with nASTR tokens.
After staking ASTR tokens in one of the vaults, users will choose a dApp to supply the ASTR they have staked and earn rewards from the revenue stream of that dApp.
Eventually, instead of the direct lending/farming on dApps, users will be able to supply ASTR through Aglem and get nASTR and ALGM as an incentive reward.
Liquid staking and Liquid Lending are our main products for this year. In 2023 we will concentrate on expanding beyond Astar Network, which includes more nASTR and ALGM usage outside Astar, launching our liquid products on Moonbeam and Acala.
Our mission and vision are to become one of the most dominant and valuable dapps in the Polkadot ecosystem.
So we hope you enjoyed the replay of the AMA here, let’s now get in to the questions of the winners, who will be receiving the airdrop. Well done to you guys, and of course a big thank you to everyone that took part and got involved!
User: GIL. : nASTR is coming to Starlay? They have had problems and lost credibility, but given the compatibility of liquid staking and lending protocols, I think collaboration is a must. – Greg
Answer: Yes, we will make an announcement about our partnership later this week. Basically, we are going to be a partner with all major DeFi dApps on Astar Network.
User: KHUSHAL. : Why did you choose to build your project on the Polkadot blockchain while many other blockchains like Solana, Matic, Algo, and Ethereum are available? – Greg
Answer: Igor and G are Astar community managers from the beginning, so choosing Astar as a platform to build on was a simple choice. More broadly, we consider Polkadot one of the two most important ecosystems in the future (with Ethereum). That means we have a perfect opportunity for fast growth.
User: Indra : Is it the same between nASTR & Lido ETH (stETH), can be collateralized to other assets??? Because I don’t want to happen again like the stETH case – Arthur
Answer: The problem of Lido is not the only one collator or something like that. As long as Ethereum 2.0 is not launched when a user gets stETH, he can’t claim underlying ETH back.
On the other hand, in Algem, you can claim underlying ASTR back anytime on a 1-1 basis.
This means that if the price of nASTR is lower than 1 ASTR on a DEX, the most rational behavior here is to buy this nASTR for a lower price and then claim the underlying ASTR on Algem.
This possibility makes the significant nASTR price drop practically impossible. Arbitrage traders will close this opportunity very fast.
User Real_Dennis : Recently we have had some inconvenients with some of our dapps token listing prices due wrong price estimation and high apr. What makes algem token different? What are your plans to don’t create false expectations to our community? Thank you – Greg
Answer: First, we have never before and never will use an estimated price for our token because it is practically impossible to predict token price, especially during a bear market.
Secondly, we have been working on our token model a lot.
Our main goal was to make our token an essential part of Algem and ensure a suitable value accrual mechanism.
Our tokenomics may look a bit complicated for new users. Still, we will publish many education materials to make it clear and easy to understand for everyone.
We are planning to launch our token in September or October – make sure you follow our updates!
User Shoemaker : Hi! If we stake ASTR on Algem.io, who has custody of the ASTR? Are we giving you custody of our ASTR tokens, or do we maintain custody in our Astar (Polkadot.js or EVM) account? We are all very concerned about security and not losing access to our token like we see happening with other protocols. Thank you – Arthur
Answer: This is an interesting question, as it is a bit counter-intuitive. Technically, when users interact with our LiquidStaking application, the custody of tokens is transferred to our LiquidStaking contract, however, those tokens are staked in Astar dApp Staking straight after, which locks them on the Astar side, so to speak. This means that even though technically, our contract becomes the custodian of those tokens, because those tokens are locked in Astar’s dApp Staking, only the user can unlock them and claim them back, by redeeming his nASTR tokens.
That’s all for now, thank you to all who tuned in and catch up with us again in the next one.
Algem is a dApp built on Astar Network and offers two main features: liquid staking and liquid earning. As the name implies, these two solutions enable ASTR holders to remain liquid with their assets while putting them to work.
The liquid staking and liquid earning solutions allow users to accumulate staking rewards and increase their earnings using Algem’s liquid nASTR tokens across Astar’s DeFi ecosystem. In doing so, Algem supports other DeFi protocols by providing liquidity, creating a sustainable and cooperative ecosystem on Astar Network.
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