Spotlight: Neptune Mutual NPM Tokens

4 min read

This post on NPM tokens answers important questions from community relating to its use cases.

If you're a part of the Neptune Mutual community or are interested in joining, it's important to know about NPM tokens.

As the foundation of our ecosystem, NPM tokens play a central role in powering our decentralized marketplace. Whether you're looking to purchase cover policies, provide liquidity to cover pools, report incidents, or access additional market features, holding NPM tokens is crucial.

In this article, we answer a number of questions about NPM tokens and explore how they enable you to engage with the various aspects of the Neptune Mutual ecosystem.

What Are NPM Tokens Needed For?#

Our ecosystem is powered by the NPM token, a utility token that plays a central role in our platform. The NPM token is publicly available in an NPM/USDC pool in Sushi on Arbitrum and also in a Uniswap-v2 pool on the Ethereum blockchain.

With a maximum limit of one billion tokens, we will issue them over a span of around ten years or longer. Holding and locking NPM tokens is a crucial part of completing actions within the marketplace application.

Users of the Neptune Mutual marketplace are required to hold or lock NPM tokens as detailed in the conditions associated with different actions, such as purchasing a cover or providing liquidity.

To purchase a policy, you will need to hold a specific number of NPM tokens in your wallet and maintain that amount throughout the policy's duration. The NPM requirements vary depending on the cover policy so you’ll need to check the specific details in the terms and conditions of the cover product that you are planning on purchasing.

NPM tokens are also required to provide liquidity and become an LP (Liquidity Provider). By contributing stablecoin to cover pools, you can receive a portion of the policy fees resulting from users that have purchased covers from the pool.

NPM tokens are required to participate in the incident-reporting process too. Holding NPM tokens allows you to report new incidents or vote on reported incidents;. The number of NPM tokens required depends on your role in the reporting process. For instance, voting on an incident requires a small number of tokens, while the Candidate and First Reporter positions demand a larger amount. For a detailed guide to the incident reporting process, read our blog, “Claims Assessment in DeFi Insurance”.

NPM tokens will also provide access to various features, such as boosted rewards from the liquidity gauge pool. These features offer opportunities for users to enhance rewards within the Neptune Mutual ecosystem.

For projects in the CeFi, DeFi, and Metaverse spaces looking to create a cover pool within the Neptune Mutual marketplace, reach out to the Neptune Mutual team. The cover creation process is not permissionless at this stage but requires approval from Neptune Mutual Association. And it also involves locking and burning a certain number of NPM tokens.

Overall, NPM tokens have several use cases in the Neptune Mutual ecosystem. They are integral to accessing and participating in the various aspects of Neptune Mutual, including purchasing cover, providing liquidity, participating in incident reporting, and accessing additional market features.

How Can You Acquire NPM Tokens in Order to Use the Cover Marketplace?#

For purchasing a cover policy, it’s sufficient to hold NPM tokens in your wallet on any chain. They do not have to be held on the chain for which you have purchased cover. Tokens need to be held at the same wallet address as the wallet that purchased the cover policy.

Tokens can be bridged from Ethereum or Arbitrum to the BNB chain or vice versa using the Bridge UI that can be found at the top of the marketplace application.

Will You Be Able to Use NPM Tokens to Vote in the Snapshot NPM Emission Votes?#

Yes. Users will be able to vote using NPM tokens once the vote escrow and liquidity gauge pool mechanism is launched. This mechanism governs the distribution of NPM emissions to qualifying cover pools.

It will not be possible to increase voting power or achieve any sort of boost in NPM emission rewards with an NPM token. For increased voting power of up to x4 and an increased boost of up to x4, users will need to lock their NPM tokens in the vote locker.

Follow our YouTube channel and watch the tutorial on the veNPM token and liquidity gauge pool. And follow our Twitter and Discord channels for announcements on release dates for the veNPM token, Snapshot voting, and the liquidity gauge pool.