After much deliberation and careful thought Neptune Mutual decided to close the cover marketplaces.
After much deliberation and careful thought Neptune Mutual decided to close the cover marketplaces. Below the reasons for the decision as well as what it means for the community.
The marketplaces will be closed using an emergency withdrawal process whereby the liquidity provided to cover pools by LPs will be returned to the wallet addresses from which the liquidity was supplied. In addition to protecting cover pool LPs, there will also be refunds to all cover policy purchasers with an existing and valid policy who have paid over 10 USD in policy fees in one transaction.
For veNPM holders, please fill out this form to receive a refund for your veNPM to NPM conversion penalty.
From the end of June there will no longer be NPM emission incentives for LPs i.e. Epoch 3 of the liquidity gauge emissions will be canceled.
Unused funds raised from financial backers will be returned to those backers; this includes DEX liquidity that has now been removed from SushiSwap and Uniswap. A small amount of liquidity on SushiSwap Arbitrum has been left to enable a minimum amount of NPM trading.
The protocol will be open sourced, and become a true public good. Enabling the community to fork the code developed by the Neptune Mutual team such that others might use the existing resources to further our mission to make the blockchain space better protected against smart contracts and other risks.
There are numerous factors that have led to this difficult decision, some of which are external factors which are uncontrollable or unforeseeable. A few factors summarized below:
“Given Neptune Mutual’s Tier 1 backers, why have you not listed on a top CEX?”
This is perhaps one of the most frequently asked questions. In short, the answer is that for a variety of reasons Neptune Mutual was not able to achieve the diverse set of performance metrics (community size and engagement, marketplace user activity, DEX 24 hour trading volume, TVL growth etc.) required to list on top tier CEX. The CEXs that are prepared to list NPM token do not have the depth of liquidity or breadth of user-base to offer good prospects for NPM tokenholders.
“Why has Neptune Mutual not achieved strong growth?”
It is tempting to take a shortcut to answer this question by pointing a finger at one specific factor, but the reality is that there are many contributing factors. A few summarized below:
Since the outset of engaging with the community we have endeavored to highlight the need for DeFiInsurance; Neptune Mutual built a comprehensive dataset of on-chain hacks available, anywhere, and each week we highlight the many millions of dollars that are stolen as a result of smart contract hacks. Despite this, we have consistently been confronted by projects unwilling to spin up cover pools in our marketplace because of the sentiment that audits of their code are sufficient to persuade their community that their protocol is safe. Less than 0.3% of all digital assets are protected with some form of DeFiInsurance, and yet despite all the media reports of hacks, the conference discussions about the importance of governance or CEX proof-of-reserves, it continues to be the case that it is extremely difficult to get media attention to focus on the need for a fast and efficient means of mitigating smart contract risk.
A variety of approaches have been taken by different DeFiInsurance protocols to address this, from attending multiple conferences throughout the year and significant marketing spend, to the leaner approach that Neptune Mutual took (in part as a result of the bear market in 2023). What can be said is that no DeFiInsurance protocol has managed to achieve significant growth over the last 18 months, sadly the overall TVL of the sector has shrunk a lot.
For all the reasons above, at this moment the best course of action is no longer to double-down on investing in growth, but rather to refund unused capital and close the marketplaces.
The consequences are very tough for the Neptune Mutual team who have spent the past 3 years of their time on the mission to facilitate safer environments within DeFi. The team has delivered products according to the roadmap and the fact that the protocol was never hacked, despite attempts being made on the darkweb, is testament to the expertise, passion and absolute focus on security. The team survived the FTX and UST crisis unscathed, and believed that the continued growth in hacks would lead to growth in the demand for a good solution to mitigate these risks, but sadly, as can be seen right across the DeFiInsurance category, this is not yet in sight. So we would like to thank the team for all the dedication, skill and passion invested into the Neptune Mutual project since the outset.
The team will open source the protocol, including blockchain indexing protocol (subgraph alternative), frontend, middleware, database, and backend code, to make it a true public good. This will allow anyone to fork the code and create covers by defining parameters and premium ranges, potentially leading to innovative covers and organic usage.
The Discord channel will be closed to reduce the risk of phishing and other types of cyber attack, any questions / queries will be responded to in the Telegram channel.
We want to take this final opportunity to thank you all for your support.
Neptune Mutual will contact only its financial backers, with whom a signed agreement exists, in relation to next steps (i.e. holding NPM tokens does not qualify you for any form of refund). Contact will be made only from a neptunemutual.com domain email address so please check the source of any email you may receive very carefully. Please ignore any messages from any other email or social media accounts in relation to token/cash refunds.
Our Staking and POD Staking features will focus on rewarding liquidity providers and token holders.
Besides being user-centric, Neptune Mutual is also a community-centred protocol. We believe that blockchain projects thrive and achieve greater goals because of their communities.
It is our mission to bring together user communities and gather support for their favourite protocols by becoming liquidity providers.
That’s why we’re so excited to let you in on our latest features release tomorrow — Thursday, March 24, 8 AM HKT.
Our new Staking and POD Staking features will focus on rewarding liquidity providers and token holders on the Neptune Mutual platform.
Read on to find out how each unique feature works and rewards liquidity providers.
Staking NPM tokens is one of the most important features of the Neptune Mutual protocol. Neptune Mutual’s Staking feature intends to generate rewards for NPM token holders and liquidity providers.
Step 1: To stake NPM tokens, go to [Pool] at the topmost portion of the homepage.
Step 2: Go to the [Staking] tab.
Step 3: Once there, choose the cover card you want to stake NPM tokens on.
On the cover card, you’ll find the cover’s:
APR. The annual percentage rate investors may earn from staking their NPM tokens after interest rates and other fees.
Lockup period. This tells you how long your staked tokens will stay locked on the platform.
TVL. Short for total value locked by the cover’s liquidity providers shown in US dollars.
Take note: On the testnet, the lockup period is set for 5 minutes to make testing more convenient. NPM tokens can’t be withdrawn during the lockup period.
Okay, now back to staking…
On the cover card, you’ll find the [Stake] button.
Step 4: Click [Stake] to stake NPM tokens for the cover of your choice.
Step 5: Enter how many NPM tokens you want to stake.
Step 6: Click [Approve NPM].
Step 7: Confirm your stake from MetaMask until the platform approves it.
Step 8: After that, click [Stake].
Step 9: Confirm the following MetaMask transaction to stake NPM.
Rewards and Stake Withdrawal
Find your share of staked NPM tokens and rewards generated on each of your active covers.
Step 1: You can supply more NPM to your cover pools by clicking [+].
Step 2: Click [Collect] to withdraw your share.
You can harvest token rewards generated by clicking [Collect] under the Harvest tab.
Step 3: Click [Confirm] from the MetaMask notification to complete the transaction.
Under the Withdraw section, you can fully or partially withdraw your staked NPM.
Step 4: Enter the number of NPM tokens you want to withdraw.
Step 5: Click [Unstake].
Step 6: Confirm the transaction request from MetaMask and wait until your stake withdrawal is successful.
Cover creators can offer their project’s native tokens to attract and incentivize liquidity providers.
Liquidity providers will each receive an equivalent Proof of Deposit (POD) to their staked asset of stable cryptocurrency in DAI.
As a liquidity provider, you can stake PODs in the Neptune Mutual pool to earn greater returns called Shield Mining Rewards.
Step 1: To stake your POD, go to the [Pool] tab at the topmost part of the homepage.
Step 2: Next, go to the POD Staking section right beside Staking.
You’ll find the cover cards available you can supply liquidity to. Every cover will have its respective card to stake PODs.
Just like with staking…
You’ll find the cover’s APR, lockup period, and TVL on the cover card. Scroll back to the Staking section of this blog to review what these terms mean.
Note: For the testnet, the same 5-minute modified lockup period with Staking will apply to POD Staking. Again, users can’t withdraw NPM tokens during the lockup period.
Step 3: Click [Stake] for the cover you want to stake PODs on.
Step 4: Enter the amount of POD you want to stake.
Step 5: Confirm the transaction request from MetaMask and wait until your POD stake gets approved.
