OlympusPrice

(OHM)

Olympus (OHM) is a decentralized reserve currency protocol on the Ethereum blockchain. Its main objective is to create a policy-controlled decentralized currency that serves as a global unit-of-account and medium-of-exchange. It aims to be an alternative to stablecoins, which can be affected by inflation, and volatile cryptocurrencies. The project is managed by a Decentralized Autonomous Organization (DAO).

The Olympus protocol uses two main mechanisms: staking and bonding. Staking allows users to earn rebase rewards, which compound their OHM tokens at regular intervals. These rewards come from protocol revenue and adjust based on the staked amount and DAO-set rates, promoting long-term holding. Bonding involves users acquiring OHM at a discounted rate by exchanging assets like stablecoins or other crypto assets with the protocol. These OHM tokens vest over a period, allowing Olympus to accumulate treasury assets that back the issued OHM.

No, OHM is not a stablecoin; it's considered a "decentralized reserve currency." Unlike stablecoins pegged to fiat, OHM is backed by a basket of diverse assets held in the Olympus treasury. This treasury can contain stablecoins, other crypto assets, and liquidity provider shares. This backing is intended to ensure a minimum intrinsic value, but OHM's market value is designed to float freely, not maintain a fixed peg. The specific assets in the treasury are subject to change through governance decisions.

Protocol-Owned Liquidity (POL) is a concept pioneered by Olympus where the protocol directly acquires and owns the liquidity for its tokens. This contrasts with traditional models that rely on external liquidity providers. By owning its liquidity, Olympus aims to ensure consistent availability for OHM and enhance market stability, as it doesn't depend on external parties during market fluctuations. Furthermore, the protocol's treasury benefits from a significant portion of the transaction fees generated from this owned liquidity, contributing to its overall revenue.

The (3,3) meme, popularized by Olympus, illustrates a game theory concept promoting cooperative behavior among users within the protocol. It suggests that the most advantageous outcome for both individual token holders and the protocol itself occurs when all participants choose to stake their OHM (symbolized as +3 for staking). This is presented as more beneficial than bonding (+1) or selling (-1). The meme became a widely recognized shorthand in the Web3 community to signify a collective commitment and belief in a protocol's long-term success.

Olympus offered exceptionally high Annual Percentage Yields (APYs) to encourage users to stake OHM and support long-term participation. These significant rewards aimed to bootstrap adoption and foster a committed user base. Despite attracting considerable attention, these high APYs also led to concerns and accusations, with some critics suggesting the model resembled a Ponzi scheme. They argued that the substantial yields might depend on a constant inflow of new capital to reward earlier participants, questioning the long-term sustainability without continuous growth.