The DeFi (decentralized finance) ecosystem has increasingly evolved over a short time. Experts have spent long hours cracking their brains to set up new protocols that would either reduce or end challenging problems. They strive to eliminate poor governance and volatility in the DeFi systems.
PICKLE developers believe that they have solutions to these challenges. Pickle Finance is the newly created protocol that is powered on the Ethereum network.
Pickle emerged from a food-themed meme on the DeFi token. The newly set protocol has promised to bring together stablecoins by use of farming incentives, vaults, and effective governance.
This latest mechanism has aimed to bring lower pegged stablecoins back to their underpinning by ensuring there is reduced volatility in the ecosystem. PICKLE might appear as the next big yield farming bombshell soon.
What is Pickle Finance?
Today, Pickle Finance(PICKLE) stands as the latest rising star in the Defi ecosystem. Pickle Finance is a crypto token designed to operate on the Ethereum platform. Baby PICKLE project found its way to the blockchain network on September 11, 2020, after launching with little fanfare. However, it has steadily gained popularity to become the latest trending food token.
Pickle has a current circulating supply of 745,500. PICKLE is exchanging hands $31.23 by the time of writing and has managed to rally above 1500% since its launch. Currently, PICKLE token is ranked at position 251 in the coin market capitalist.
How Does Pickle Finance Operates?
In the DeFi ecosystem, DAI, USDC, USDT, and sUSD rank as the major and largest stablecoins today. Sometimes, these stablecoins operating on Ethereum DeFi often stray away from their underpinning asset as a result of varying market volatility and other limitation in monetary policy.
This challenge has currently worsened with the rising of yield farming where farmers trade large volumes of stablecoins while chasing the highest yield. Pickle has introduced the use of incentives to motivate capital movement between stablecoins to restore them to their intended market value while simultaneously incentivizing participants in the ecosystem.
Also, for the set protocol to work effectively, Pickle Finance has introduced Pickle tokens which will be rewarded to users as incentives and also more importantly used to offer flash loans to short overvalued stablecoins.
Monetary Policy of Pickle Finance
Just like Bitcoin and other types of tokens, Pickle is minable. You can mine PICKLE by staking Uniswap LP token in major mining pools. This token is currently emitted through an ongoing liquidity mine in the Pickle ecosystem. Additionally, this token is set to be distributed to several mining pools particularly
Pickle Token Distribution
Newly minted tokens are distributed among every participant staking LP tokens for the above mining pools. To clamp down inflation and maintain gradual Pickle token emission, the pickle protocol has set a weekly halving schedule.
- 1st week:10 PICKLE per block
- 2nd week:5 PICKLE per block
- 3rd week:2.5 PICKLE per block
- 4th week:1.25 PICKLE per block
- There after:1 PICKLE per block
This proposed schedule will feature a gradual decrease in PICKLE minting up until the end of the year, after which a static amount will be minted in perpetuity.
Pickle Finance Governance
Every Pickle token will represent ownership according to this new set protocol. Interestingly, Pickle has brought great innovation in this decentralized finance sector by making use of quadratic voting. This system will ensure that every token holder will participate in governance decisions and thereafter will receive a 3% governance fee and a 0.5% withdraw fee as added incentives.
The main reason which has made Pickle to adapt a quadratic voting mechanism is that this system ensures whales don’t get too much influence over governance decisions. This project prompted a response from Ethereum co-founder Vitalik Buterlin himself.
“Nice! How do you determine individual identifies to prevent individuals from splitting their funds into many accounts to avoid them being square rooted?”
However, the PICKLE technical team replied to him.
“We can’t, at least not now. We don’t want to let the perfect be the enemy of good. This will hopefully slow down the whales who want to game the system_Maybe, later on, we can advise a system to better identify users. But we are quite stretched for bandwidth right now. The project has been live for a little more than 2 days “
This project represents a good start in the protocol journey towards the firm and equitable governance.
The Future of Pickle Finance
Pickle is so far making headways under its new protocol towards its ambitious plan that brings stablecoins closer to their underpinning pegs. Hopefully, PICKLE will continue to thrive and its value will increase into the future.