$HALO sale phase I complete ✔️ Now for Phase II
Introducing Angel Protocol’s $HALO token generation and main sale event using a Liquidity Bootstrapping Pool: the HaloSwap!
Phase I of the Angel Protocol fundraising campaign is about to end, with what should be 100% of the 60 million $HALO allocated sold at a price of $0.05 on StarTerra’s IDO platform and on Apollo’s brand new ‘Farmers Market’.
So today, we’re pleased to announce HaloSwap, our main $HALO token sale event, that will start at 15:00 UTC on Sunday 19th December. Do not buy tokens purporting to be HALO before this time.
To take part, you can use the direct link — haloswap.angelprotocol.io
Or go to https://angelprotocol.io and click ‘Launch App’.
- 80 million $HALO tokens (8% of our total token supply) will be placed into HaloSwap, a Liquidity Bootstrapping Pool run by Angel Protocol
- Undistributed tokens at the end of the sale will be used to provide liquidity using the LOOP DEX
- The sale will last for 72 hours, starting from 15:00 UTC on Dec 19, 2021 and ending at 15:00 UTC on Dec 22, 2021
- The HaloSwap will start with a token price of $0.40, which indicates a $42 million market cap. This valuation will of course vary over time in line with the HaloSwap process
- The token price could go as low as $0.017 if there are no buyers during the 72-hour period. This is the theoretical price floor, representing a $1.8 million market cap. This market cap would be lower than our actual TVL upon launch
- Every time someone swaps UST for $HALO, the price of the token increases for those buying immediately afterwards. If no-one buys, the price decreases until someone decides that’s the price they want and starts buying again. A quick guide to obtaining $UST can be found here.
- If buying demand is high and exceeds the mathematically consistent downwards pressure of the LBP algorithm, the price can climb higher than $0.40. You may see this at the start of the LBP, as bots place their orders
- IMPORTANT: Do not start buying as soon as the HaloSwap launches. Let the bots take their higher priced tokens and wait until the price drops. A great example of how this w
- orks was seen in the White Whale launch this week
- The Angel Protocol parameters for the HaloSwap are as follows:
- After we raise $3.68M from the LBP for protocol development, 100% of remaining funds will be allocated to charity. These funds will become locked TVL in the Angel Protocol Endowment, with yield distributions determined by $HALO governance stakers
- Governance will be available upon conclusion of the LBP, and one of the first governance proposals will be around if & how we use the Angel Protocol Endowment to fund relief efforts for the Philippines after Typhoon Rai. You can click on the ‘governance’ tab on the HaloSwap app to see how this will work
$HALO Sale Charity Raise:
We’ve committed 20% of all funds from our token sale to be allocated to charity through the Angel Protocol Endowment, governed by $HALO stakers. We capped our development raise at $6M, so all funds (including those from the Starterra and Apollo Farming events) raised past that point go 100% into the AP Endowment.
Through StarTerra we raised $720K for Angel Protocol development and $233K for charity. Through ApolloDAO we raised another $1.6M for development and $400K for charity. In total that’s $633K for charity and $2.32M for development, leaving us with $3.68M to raise. Given most of our token sale is occurring through the LBP & there will be active price discovery, we hope to easily surpass our development funding goals and raise a substantial amount for charity.
All funds raised in this way become locked TVL for the protocol and a compelling reason to hold $HALO; not only for the staking yield, but also for the right to governance and deciding how charitable funds are allocated from the endowment.
The first governance proposal we’ll raise for discussion/submission is if & how we should allocate funds to support Philippines relief efforts for Typhoon Rai.
Governance in Angel Protocol is not a meme, it’s a core part of our decentralized ethos. As a $HALO staker, you’ll be responsible for allocating life changing funds to accomplish real world impact.
After our funding threshold is hit, a $1000 HaloSwap LBP purchase means:
- $1000 to a charitable endowment ( =$1000 in locked TVL)
- $1000 of $HALO ( =$1000 worth of $HALO voting rights to how that endowment is allocated)
Aligned incentives. Win, and help win.
HaloSwap is a Liquidity Bootstrapping Pool (LBP) run by Angel Protocol following a number of months work together with Delphi Labs. An LBP is a token/stablecoin* pair liquidity pool with special parameters that evolve over time so that, at the time of the creation of the pool, the token price is intentionally high and then decreases over time. If no one buys $HALO during the HaloSwap, the price of the token would look like this:
(*) Usually, LBPs are built with a token/stablecoin pair but they could be built with any token pair (such as token/ETH for example)
Why use an LBP for our main token distribution event?
Unfortunately, we’ve all recently seen the shortcomings of AMM token launches: very little liquidity is provided, bots make large orders microseconds after the opening of the pool, price spikes, investors buy in after the bots and the bots dump on investors for a quick profit, leaving everyone frustrated.
The LBP is an excellent tool to counter this situation. The price is high at the outset specifically to avoid front-running. Because the end price is unknown to bots, it could prove unprofitable to buy in the first hours of the event. Hence our advice to all participants: do not buy in the first hours of the event or you may get rekt. We will reiterate this as the date approaches.
As time passes and the price decreases, participants can buy the token at a price they’re comfortable with. And anyone can join in. There is no minimum or maximum amount although it is worth noting that a large purchase can cause a high price slippage.
Unlike with normal IDO’s, participants can also sell their tokens at any time they want. This allows for market forces to enter into play until the token price finds its equilibrium at fair market value. For example, this is what the price of the PERP token ended up looking like during their LBP:
LBP Weighting Explained:
Rather than trying to maintain a 50:50 token weight equilibrium as most Liquidity Pools (LPs) do, LBPs instead use token supply weighting to drive fair price discovery.
The starting weights are skewed toward the token being sold ($HALO) and adjust to increase the ratio of the reserve asset ($UST) throughout the event. This exerts a constant downward price pressure on the pool as the weights adjust, which is balanced against upward buying pressure of the $HALO token. Note: The charts below show the case if there was no buying pressure, which would of course increase the price, potentially higher than the starting price such as the PERP chart showed.
The result? Fair, bot-resistant price discovery. While this is generally true of all LBPs, the specific starting & ending weights are crucial in determining how the price will behave. Extreme weighting at either the start or end will result in a steeper impact curve.
Choosing a 96:4 starting ratio helps us avoid a steep decline from initial price, allowing for a gentler and more organic price discovery. Mitigating that kind of opening volatility was a key reason we chose an LBP.
The 50:50 ending weight was based partially on Delphi Digital’s analysis of prior LBPs that determined the end weight disproportionally cancels the effect of the buying pressure in the final hours of an event, but primarily on the fact that we wanted adequate $HALO supply to enable protocol-owned liquidity (POL).
Want to know more about how LBPs work?
A detailed description of how the HALO token works using an LBP can be found here courtesy of our friends at Delphi Labs.
Check out this video introducing LBPs and made for White Whale’s own LBP or this cool run-through by Danku_r about the very recent White Whale “BootSwap” LBP.
Do take a look.
What Comes After the LBP?
In practice, tokens allocated for LBP purposes typically are not sold out entirely. This is due to the fact that tokens are swapped via the HaloSwap AMM. In order to completely drain the $HALO token supply, the price would have to spike up to an extreme (theoretically infinity).
After our LBP concludes, token liquidity on the LBP will be removed and $HALO tokens will be available for trading on the LOOP DEX where the LP will be incentivised.
We will route a significant amount of our proceeds and a proportional supply of $HALO tokens to provide protocol-owned liquidity at the last LBP price.
About Angel Protocol:
Angel Protocol is a global social enterprise building on the Terra blockchain that leverages decentralized finance (DeFi) to create perpetual endowments for charities. We abstract away the complexity of DeFi while providing all the benefits for those who need it most: charities & non-profits. By doing so, we build a world where all charities can have financial freedom. With us, when their donors give once, they give forever.