Divergence, a decentralized derivatives protocol, announces that its updated public token sale will be held at Balancer’s Liquidity Bootstrapping Pool (LBP) on 27 September at around 1 PM UTC. The public sale is updated due to security concerns related to a recent exploit of SushiSwap’s MISO launchpad, where the sale was originally scheduled on.
Divergence Protocol is backed by industry-leading investors including Mechanism Capital, KR1, Arrington Capital, Huobi Ventures and AscendEX. For the past three months, the protocol has seen a massive growth in its community. It released a public beta in August. With its code base being audited, Divergence is preparing for the launch of its V1 platform in Q4 of 2021.
The DIVER public sale will last for approximately 24 hours, between 01:00 PM UTC September 27, 2021 and 01:00 PM UTC September 28, 2021. 30 million DIVER tokens (3% of the token supply) will be available for purchase. Upon sale completion, undistributed tokens will go into Divergence’s token reserves. This portion of supply only starts to unlock 1 year after token generation.
- DIVER tokens can be purchased with USDC, and ETH is needed to pay gas. There’s no maximum or minimum amount of tokens set for purchasers.
- Divergence’s LBP will start with a token price of $0.1, which indicates a $100 million fully diluted valuation. DIVER price will be auto-adjusted lower immediately after the sale opens, as per the LBP mechanism.
- DIVER price can go as low as $0.009 if there is no buyer during the 24-hour period. This lower bound is effectively half of Divergence’s seed round token pricing, representing a $9 million fully diluted valuation.
- Whenever there is buying demand, the DIVER price will go up, raising the purchase cost of later participants. There’s a chance that the price can go higher than $0.1. For patient participants, however, buying opportunities emerge when the price is adjusted lower.
Divergence LBP parameters are listed below:
Divergence’s genesis non-fungible DIVΞR tokens will be claimable by 256 randomly selected LBP participants. Upon LBP completion, these DIVΞRs will be available at the website of Divergence’s partner, Project.
A maximum of 7.75% of the overall token supply is expected to be initially circulated in the market. This initial circulating supply will remain unchanged following the updated sale. In order to proceed with a Balancer LBP for 3% of the total DIVER supply, the liquidity provision token allocation is scaled down from 4% previously to 3%. Only 1% of liquidity provision tokens will be unlocked in the beginning to support token listing.
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 Balancer AMM. In order to completely drain the DIVER token supply, the price would have to spike up to an extreme. When the LBP concludes, those tokens left undistributed in the pool will go to reserves, which won’t start to unlock until 1 year after the TGE. The actual initial circulation is expected to be lower than 7.75%.
After the public sale, DIVER tokens will be available for trading on SushiSwap. Divergence will route the majority of proceeds and a proportional supply of DIVER tokens to a SushiSwap liquidity pool. This pool is expected to become Divergence’s liquidity venue for the long term. The remainder of the sale proceeds will be reserved for liquidity events in the near future.
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