On Dec. 15, Genius Yield, a decentralized automated market maker and liquidity management protocol built on the Cardano (ADA) blockchain, announced the launch of its initial stake pool offering, or ISPO. The fundraising will continue for six months until June 15, 2022. At the time of publication, more than 95.8 million ADA, worth approximately $118 million at the time of writing, have been delegated to the stake pools.
In an ISPO, blockchain enthusiasts stake their cryptos in a protocol and receive tokens of the new project they fund as rewards. After a lockup period, investors can then reclaim their staked cryptos. By utilizing this method, investors not only harvest yields, but they also, on paper, get back their initial investments. Of course, the setup is still susceptible to risks such as technical glitches, hacks or rug pulls that are not as apparent with more orthodox funding methods.
In this particular ISPO, users deposit their ADA from their Cardano wallet, such as Yoroi, into one of the four GENS stake pools and receive the GENS token. According to Genius Yield developers, 10 million GENS tokens out of a total supply of 100 million will be distributed to ISPO investors. In addition, they will also receive 20% of transaction fees on the platform.
The funds will be used in part to build a solution that enables users to benefit from advanced algorithmic trading strategies and yield optimization on the Genius Yield platform. Dr. Sothy Kol-Men, co-founder of Genius Yield, said the platform is building a “community-driven educational and mentorship” program that teaches users about decentralized finance, or DeFi.