Ooze Finance - Building a Successful Algorithmic Stablecoin on Cronos

The Tomb Finance fork seeks to become a $DAI-pegged stablecoin, along with building its value proposition through future platform expansions.

By
Web3Wire
on
July 14, 2022
Category:
DeFi

What is Ooze Finance:

Ooze Finance is a Cronos-based project that aims to create a successful algorithmic stablecoin, $OOZE, that is pegged to the $DAI token. The project is a fork of Tomb Finance, an algorithmic stablecoin backed by the $FTM token.

Along with the stablecoin offering, Ooze Finance is also a Decentralized Autonomous Organization (DAO) and offers staking for users. The algorithmic peg is maintained by having 3 unique native tokens that work in unison: $OOZE, $OOSHARE, and $OOBOND. The Ooze Finance team claims in the project whitepaper that they are the first project of their kind on the Cronos network.

Source

The primary focus of the project at the moment is providing a DAO-driven stablecoin that offers consistent yield returns without sacrificing on price stability. The team believes that they can achieve these goals on Cronos in particular due to the absence of similar projects on the chain.

Future Value Ooze Finance Plans to Bring

Currently, Ooze Finance’s primary focus is providing a sustainable, low-turbulence stablecoin for Cronos users. However, Ooze Finance has stated its primary goal is to become a ‘blue-chip’ project on the Cronos network. The team believes that to achieve this, they need to focus on sustainability and ecosystem expansion. This means maintaining the peg of $OOZE whilst simultaneously building out a larger platform, with the team calling the initial Tomb Finance fork a ‘launchpad’ for future endeavors.

In order to achieve this goal, the platform plans to expand into Non-fungible Tokens (NFTs), lending/borrowing, and nodes in the future. The team is also open to community suggestions and will use the $OOSHARE DAO for project decisions and planning. 

Three Token System

Source: The three tokens that comprise the Ooze Finance ecosystem

As previously mentioned, Ooze Finance uses a combination of $OOZE, $OOSHARE, and $OOBOND to maintain a peg with $DAI. Let’s take a quick look at what each of these tokens contributes to the Ooze Finance ecosystem:

$OOZE - The $OOZE token is the stablecoin and primary token of the ecosystem. It is intended to maintain a 1/1 Time Weighted Average Price (TWAP) peg with $DAI. Its planned utility includes staking, lending, borrowing, and trading.

$OOSHARE - $OOSHARE (or Ooze Share) is used to check the value of the protocol and the trust of the $DAI-$OOZE peg. It essentially serves as a ‘share’ in Ooze Finance, with $OOSHARE holders serving as members of the DAO. Each epoch expansion rewards $OOSHARE holders with $OOZE. There is a fixed supply of 50,001 $OOSHARE tokens.

$OOBOND - $OOBOND (or Ooze Bonds) are used to monitor the supply of $OOZE during epoch contractions. When the TWAP of $OOZE falls below the peg with $DAI, $OOBONDS are available for purchase with $OOZE. All $OOZE tokens used to buy $OOBONDS are burnt, reducing the supply to lower inflation. Once the price of $OOZE has gone over the $DAI peg, $OOBOND holders can exchange the ‘bonds’ for $OOZE. 

The team shared optimal strategies for holders to use when trading the three Ooze Finance tokens in their whitepaper.

Genesis Pools

Ooze Finance will be offering Genesis pools with intriguing Annual Percentage Rates (APRs) for early adopters.

The Genesis pools will run for only 24 hours. The pools have 2,400 $OOZE that is distributed to stakers over a 24-hour time frame. 

As this is the first time any $OOZE is minted, users stand to receive higher value rewards. $OOZE will be above its peg with $DAI during this time, making the rewards extra valuable. Users can access the pools via the staking section on the Ooze Finance website.

Concluding Thoughts

Ooze Finance seeks to become as utilitarian of a project as possible, with the team looking to become as big of a name as Mad Meerkat Finance in terms of available products. Capitalizing on the lack of algorithmic stablecoins on Cronos, Ooze Finance has identified a niche that they will continue to build upon.

During times of market instability, being able to count on passive income is a major boon. If Ooze Finance can maintain its peg with $DAI and provide consistent returns, it could see massive growth during the downcycle.

For more information, visit the following links:

Website | Twitter | Telegram

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