Move over. There's a new cook in the kitchen and he’s bringing the $BACON.
One of the most powerful features of Web3 is composability. To boil a huge concept down into a brief summary, “composability” describes the innate ability of open-source blockchain technology to be permissionless-ly built on top of by other projects and developers. This unlocks unprecedented innovation, creating global network effects that have (and will continue to) change the way we interact with everyday applications.
When we see composability in action across Web3, two terms often pop up: “DeFi legos” and “NFT utility.” But what are they and what do they mean for the Bacon Protocol? Lastly, how can we leverage these concepts to maximize the financial opportunities for everyday Bacon users?
As you may have seen lots has been cooking in the Bacon Protocol the last few weeks! The team and the community are running fast together to move the protocol forward.
Today, we’re releasing a significant update to the protocol that increases security, improves usability, and reduces gas fees. We’re also announcing the completion of the recent security audit.
Along with that, here are a few of the biggest news to catch up on from April:
At Bacon Protocol, we’re bridging the gap between DeFi and the mortgage market. We believe in the ethos of permissionless access, non-arbitrary, market-driven rates and we’re employing these DeFi-native concepts to innovate in the mortgage industry. One of these tools is our utilization of an Automated Market Maker (AMM) to decide both the interest rates borrowers will pay as well as the interest rates that bHOME holders will earn.
What is an AMM?
The Automated Market Maker (AMM) is a model popularized by decentralized exchanges (DEXs) like Uniswap as a more efficient replacement for traditional order matching and order book systems. AMMs are autonomous protocols that use smart contracts to define the price of digital assets. In AMMs, protocols pool their liquidity into smart contracts in order to create liquidity pools. These liquidity pools are replacements for the traditional buyer and seller markets that have required market makers to help create and solidify markets on centralized exchanges.
In an AMM, providing liquidity for trading pairs is automated by creating permissionless pools for specific pairs - for example ETH/USDC. This allows anyone to provide liquidity for the pool by depositing both of the assets represented in the pool. By using liquidity more efficiently, these pools are able to regulate the asset prices and reduce price volatility.
10,000,000 $BACON tokens will be distributed to liquidity providers across Uniswap’s BACON-USDC pool and Sushiswap BACON-ETH pool over the next 12 months.
In this post, we will walk you through the process of creating a liquidity position on Sushiswap. Learn how to deposit into the Sushiswap BACON-ETH pool in order to earn extra $BACON tokens proportional to your percentage ownership of the pool. For example, if you own 1% of the liquidity pool, you’ll be distributed 1% of the weekly tokens allocated to that pool.
Before we begin you’ll need the following:
Liquidity is the bread and butter of DeFi and we’re proud to be cooking up our new LP rewards program distributing 10,000,000 $BACON tokens to liquidity providers over 12 months.
In this post we will walk you through the process of creating a liquidity position on Uniswap; You’ll learn how to deposit into the Uniswap liquidity pool in order to earn extra $BACON proportional to the percentage of your ownership stake of the pool. For example, if you own 1% of the liquidity pool, you’ll be distributed 1% of the weekly tokens given to the pool.
Before beginning the process you’ll need:
10,000,000 $BACON distributed to liquidity providers over 12 months.
On February 2, 2022, Bacon Protocol launched our Liquidity Provider (LP) Rewards Program on Uniswap and Sushiswap. Both pools are live and currently distributing BACON rewards and fees to pool liquidity providers.
Official Pool: Uniswap USDC-BACON Pool.
Official Pool: Sushiswap ETH-BACON Pool.
The road to on-chain mortgages lies in bringing offline loan originators, on-chain
The Bacon Protocol is changing the mortgage landscape as we know it by bringing the benefits of Web3 infrastructure to the traditional mortgage market. We are democratizing mortgages in two major ways.
First, Bacon helps its users get the same safety and benefits from mortgages on US homes that traditionally have been reserved for banks and governments. Until now.
Second, Bacon is creating a new, more capital efficient system for setting interest rates and term lengths on mortgages. We do this by acquiring mortgages from a network of loan originators and adding them to the Pan. This allows the protocol to accrue interest from the mortgage payments, most of which gets passed on to users who hold bHOME tokens.
Pans, Eggs, and Bacon. The keys to a delicious breakfast, or the tools to decentralize the $16T US mortgage ecosystem? 🤔
The Bacon protocol is creating a decentralized mortgage lending system that will become the new industry paradigm. Bacon’s permission-less, open-source environment will allow any investor to get access to the tools that major financial institutions have utilized for decades. Anyone can be a part of this lending or borrowing – all you need is an Ethereum compatible wallet and USDC.
To leverage this revolutionary technology, there are a few terms we want to introduce - all components of a balanced breakfast – Pans, Eggs, and $BACON. Let's start cooking!
Around 12:46 UTC on March 5th, 2022, a contract on the Ethereum mainnet exploited a previously unknown reentrancy in the bHOME Pan Lend method. The BaconCoin team was alerted, found the issue, and patched the contract within three hours of the initial exploit. The BaconCoin team quickly re-audited the contract and is also working with new, outside auditors to thoroughly verify the contracts.
Because most of the value of bHOME is held in the value of real-world homes and loans, only a small percentage of the total value was at risk. The funds at risk were only the amount held back in the Pan by the AMM for liquidity to bHOME holders. The loans, homes, and borrowers that maintain the core of bHOME’s value were naturally not affected by this event. This event showed the power of bHOME to bring real-world stability to crypto even in the face of a smart contract exploit.
The exploit contract convinced the Pan into sending 957,166 USDC out of the protocol. A second exploit was prevented by a white hat group who returned the 34,232 USDC they received. These changes caused the price of bHOME to temporarily unpeg and decrease to $0.86.
Lets break down the basics!
In crypto, specifically DeFi, we’ve constantly had romanticized ideas about what the future of finance could look like. Permissionless access, open source software, decentralization, composability on and on and on.
But since the advent of MakerDAO what true innovation have we seen? Copycat chains that have copycat dApps. We’ve just scratched the surface of what decentralized finance can offer to the world, and BaconCoin will be at the forefront - innovating DeFi and giving real world use cases for regular people.
The BaconCoin token, BACON, is now live! After lots of input from the community over the last few months and work by the team, we’ve reached a major step along the way towards our mission. We’re all working together to make it easier for people to buy homes and get access to the same mortgages banks and governments use to preserve and grow their wealth.
This is also huge step to even more decentralization for the Bacon Protocol. We’re excited to finally have the early adopters and the growing community start to participate in governance of the protocol using the BACON token.
Now that the launch is here, we want to share some of the important details about the new token, the timeline for the rollout, and most importantly, how you can help.
bHOME is the heart and soul of the Bacon Protocol ecosystem. bHOME is what we call a Stable+ coin – a cryptocurrency that both stays close in value to other currencies (like the US Dollar) and can grow in value over time (representing mortgage interest).
bHOME represents funds deposited into Pans (the core smart contract for lending) that will help the Bacon Protocol to loan out capital for mortgages. bHOME is your receipt for depositing into Pans and represents the amount deposited + interest income.
This is a unique concept that fills a massive void in the current Web3 ecosystem. A token that can diversify holdings, allowing crypto holders to access to assets that are used by banks, governments and institutions, while still accumulating interest are all 3 major problems crypto holders face that we’ve been able to solve in one single token. As an added benefit if you stake your bHOME you will accrue $BACON governance tokens into your wallet. More on this in a future post.
So if you’re interested in helping us bring home the bacon (while earning some in the process 😉) and diversifying your Web3 portfolio, let’s walk through how to deposit funds into Pans to mint some bHOME tokens!