Absinthe Network
Summary of the Project
Sanctum was born to solve the drawbacks of liquid staking. It addresses the key problems related to staking user experience and liquidity for LST tokens.
Sanctum has three sets of products:
Infinity
Sanctum has created a multi-LST liquidity pool called Infinity. LPs typically consist of two assets (SOL - USDC), but Infinity is a multi-asset pool that natively supports an infinite number of LSTs. It enables the swapping of any two LSTs with any constant-product or stableswap invariant.
Infinity itself is an LST token. INF can be directly used by DeFi protocols. A user can deposit any staked SOL or native SOL to mint Infinity (INF). Infinity has specific allocation criteria for each LST aimed at maximizing trading returns while providing a minimum for each LST. It maintains its allocation by actively adjusting swap fees for each LST. As for how Yields are determined, it depends on the number of LSTs, trading volume of those LSTs, TVL in the pool, TVL in other LPs, etc. A base staking return (a weighted average of the LSTs in the pool) of ~7.5% plus variable returns from trading fees on top of it should be expected, as mentioned by the team.
Sanctum Reserve
As the term "Reserve" suggests storage, the Sanctum Reserve is a pool of SOL tokens that provides deep liquidity for all liquid staking tokens on Solana. Any LST can use this reserve pool. Reserve serves as an important shared source of liquidity for all staked SOL.
Sanctum Router
As a user, when you want to exit staking, you have two options. First, a standard unstaking process where you log in to the specific provider app and unstake. This takes time as there is a cool-off period. Second, you can use any DEX that uses LPs as a backend to do a swap. In this scenario, liquidity for the pair is one of the core issues. Sanctum's router solves this by its Reserve, which acts as a unified liquidity network through which it can deposit and withdraw stake accounts into different LSTs.
Breakdown of Points Program
Sanctum has named its Points Program "Wonderland." To become eligible, a user must purposely enroll in the program when they log in to the application. However, they do have the option to skip, which is interesting. This means not every user who is participating in the protocol is eligible unless they actively participate, which could also be seen as less dilution of rewards.
Wonderland is designed to be fun and interactive. To earn XPs, users need to own a Pet, which is a gamified version of a unique LST token. Based on pet ownership, users are allocated XPs. To become eligible to earn XPs, users need to hold a minimum of 0.1 Sol for each LST.
All Pets earn 10 EXP per minute for every 1 SOL worth of their respective LST. This is known as the base rate of earning EXP. As long as you hold your Pets, they will gain XP. The base rate will remain constant, but the increase will be exponential, leveling up to 999. The criteria to level up is not defined yet. Also, there is the fun aspect of Pets evolving. There will be three versions of Pets, although they have not yet been released.There are 18 Pets or 18 LSTs available on which XPs are allotted. There are many more LSTs, but they don't have XPs yet.
18 Pets or LST Tokens
EXP Multipliers
Wonderland has multipliers, which increase the rate of earning XPs temporarily based on the extra effort done by the user. Multipliers usually activate from a 5-minute span to a week. Sanctum has a concept of community quests; when a user completes a quest, depending on each quest and its reward, a user will get this multiplier.
Community Quests
Community quests are tasks and puzzles that a user needs to solve to earn extra XPs. There are two kinds of quests: Task quests – milestones for the user and the community to collectively achieve, and Puzzle quests – puzzles for the user and the community to solve. Quests will be released weekly in batches of 2-3.
Referral Cupcakes
Users who join Sanctum Wonderland using someone else’s referral code have the opportunity to win bonus EXP at the end of Season 1. Participants are only allowed to join using one referral code.
If another user successfully joins Sanctum Wonderland using their referral code, they, as the referrer, earn 5% of their referee’s EXPs throughout Season 1.
These earned EXPs through referrals are referred to as Referral EXP. For every 20,000 Referral EXPs earned, participants will automatically receive a Referral Cupcake. At the end of Season 1, each Referral Cupcake can be exchanged for bonus EXPs and added to the participant's Total EXP count.
Users who have already joined Sanctum Wonderland without using a referral code cannot claim a referral code retroactively. Referral codes can only be utilized during the onboarding process. However, users will still possess their unique referral code and can share it with others interested in joining Sanctum Wonderland.
Important Points to consider
Early users get rewarded retroactively till the date of the launch of Wonderland.
XPs get updated in a 5-minute interval.
Users can own as many kinds of pets as are currently available, which is now 18. However, they can't own more than one of each kind. For example, they can have one Infinite, one Bonksie, one Driftie, etc.
When a user deposits an LST into the Infinity Pool, they are trading that LST for INF. At that point, they will earn EXP for their Infinite Pet (INF) instead of the LST originally held.
This is the overview of Sanctum's Points Program.
Key Actions for Users
Enroll in the Wonderland Program.
Use any referral code to earn extra XPs and share yours with others.
As of now, there are 18 pets available, which means 18 LST tokens. Buy all of them with a minimum of 0.1 Sol to earn XPs through all of them.
Each week, log in to the app and complete community quests to earn extra multipliers. There have been four community quests concluded till now. Now, the 5th community quest will be going live.
Wonderland effect on TVL
Wonderland went live on April 29th, 2024. According to Defillama, it had approximately $312M of TVL at that time. If we look at the charts, the spike-off started on March 24th. One reason for this could be as the airdrops concluded in the Solana ecosystem - Drift, Kamino, etc. - at the end of March, users started exploring products with no airdrop or point system. This is how it began to take off even before the official points program. They also confirmed the hint on April 15th in the Jupiter forum. From April 29th to May 21st, it touched $780M in TVL - in just 22 days, it doubled and a half.
Moreover, it's not as simple as users moving ahead and depositing into your protocol just because other airdrops are finished. Sanctum's unique approach to solving liquidity staking problems through the router and Infinity pool is really useful to people and adds value.
Sanctum did a really good job in designing its Points Program; it's one of the most innovative and fun points programs out there. What makes it different? The team had a deep understanding and clear philosophy for its users - as their founder quoted in one of the threads - "we do not want users to feel it like work; it should be fun," and they really delivered on it.
Sanctum designed its program to ensure the community collaborates and works towards a common goal. This thesis is also very well displayed in their thought while designing Sanctum, emphasizing the shift from PvP to PvE.
Community quests played an important role in community collaboration - as it is a really fun way to engage with the community and keep users excited. These rewards benefit the whole community, not just individuals. Sanctum even has a Spotify playlist that leads to an answer in one of their puzzles which is one of the examples of its method to make it interactive.
About Absinthe Labs
Absinthe Labs is building the first incentives affiliate network, and our first product is a no code points-as-a-service platform. In addition to rewarding on-chain actions, it makes tracking campaigns easy by aggregating points from questing platforms like Galxe and Layer3 into the projects native points. Absinthe also allows for easily allocating to communities such as token holders, stakers, NFT holders and Discord roles. This article was written in partnership with Absinthe Labs and @iamswastik23 on X . Check them out at absinthe.network.
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