Ampleforth-like Bitcoin rebasing token DIGG drops: crypto stimulus checks
The latest crypto stimulus (or DeFi stimulus check, to be more accurate) has just dropped.
Badger DAO, a Bitcoin-focused decentralized finance project based on Ethereum, just rolled out a new coin called DIGG. BADGER, the governance token for the protocol, already exists.
DIGG is a new token that works much like Ampleforth, a supply-elastic cryptocurrency that changes its supply based on the price of the coin at each time. Instead of being pegged to a dollar, DIGG pegs to the price of one Bitcoin. Although this may sound like a small nuance, many in the DeFi space have said that this change may result in more reflexivity in the coin’s price action.
That being said, DIGG was distributed to users of the Badger DAO protocol on a semi-quadratic basis on these three key factors:
- BADGER staked in the protocol.
- BADGER earned by the user. BADGER could and still can be earned by users by depositing liquidity into the protocol for farming purposes.
- How much BADGER has been earned by the user relative to the coins they have staked.
Regarding the semi-quadratic basis, this was done to make the distribution of DIGG more fair:
“Other details regarding the distribution were outlined in the BIP 14 forum post, including the use of a 1.75 root applied to the Earned Rewards to determine relative distribution. The purpose is to make the DIGG wealth distribution more equal among Badger users, benefiting DIGG as a product through increasing its store of value capacity. Sybil-resistance measures have also been implemented to prevent abuse of the distribution model.”
While DIGG is being distributed to all users of the protocol, the market seems to be embracing it.
Since the coin launched an hour ago, the market has priced it as high as 3.5 BTC, or in excess of over $100,000. It has since dropped toward $45,000, meaning that one DIGG is worth more than one Bitcoin at this point.
Users can stake their DIGG in Badger DAO to earn further DIGG, along with Badger rewards in some pools.
While this wasn’t exactly like the UNI airdrop, where most users got at least $1,500 worth of the Uniswap coin, there are many users reporting that they received thousands of dollars worth of DIGG in the airdrop. Some even joked that they received the equivalent of yearly salaries in DIGG.
Disclaimer: This author is an analyst at ParaFi Capital. ParaFi Capital may hold positions in assets mentioned in this article. The views displayed in this article are opinions of the author—and the author only.