Decentralized asset management protocol Babylon Finance proposes creating a “garden” for Yugalabs and Bored Ape Yacht Club’s $APE and Apecoin community.
On Friday, Babylon Finance’s founder, Ramon Recuero, announced on Twitter that the company had submitted a staking proposal to Yugalabs and Bored Ape Yacht Club (BAYC). In a lengthy thread, Recuero said that although BAYC launched the top NFT community on the Metaverse, it lacked a sustainable staking mechanic with real utility.
Recuero said forging a partnership with Babylon Finance would lead to a supercharged token mechanic for BAYC’s $APE coin. He went on to say that the mechanic would generate value and yield specifically from staked $APE coins.
Motivation Behind the Proposal
Babylon Finance is a decentralized asset management protocol that lets communities create investment clubs, referred to as “gardens,” to pool capital and invest in DeFi. Its founder believes that the Apecoin community would immensely benefit from an official Babylon garden where BAYC’s $APE can be deposited and extra $APE coins can be created/earned from it.
While they have yet to coin an official name for their proposed garden, Babylon Finance suggests APE Babylon Garden for now. However, some ideas they offered, which the community can ideate, include “The Ape Hideout,” “Ape Skull Isle,” or “The Ape Forest.”
“We propose that the treasury seeds this garden and elect top Apecoin DAO delegates to direct the funds. APE holders will be able to deposit their APE tokens along with the treasury and earn yield from them,” Babylon Finance said in their proposal.
The Rationale for the Proposal
With NFTs cementing themselves as the current highest-performing representative of online communities, Babylon Finance thinks it’s high time for communities to invest in DeFi together. It believes that DeFi will be the top-performing market sector in years to come.
Babylon Finance believes that this proposal to Yugalabs and BAYC would bridge the divide between community and finance, enabling $APE holders to build and accrue wealth from the tokens and NFTs.
Their rationale for the proposal is: with them being a mini investment DAO where users can submit and vote on DeFi strategies to earn yield for members, the Apecoin community can use them to provide liquidity for endeavors meant to develop the Apecoin ecosystem. Thus, “deepening liquidity for the broader ecosystem while generating value for APE holders.”
In a nutshell, Babylon Finance proposes that BAYC’s community members can deposit their $APE in the garden, and the investment club, in turn, would safely borrow from it to generate yield. The $APE would become a priced collateral. The generated profit will buy back more $APE, causing a flywheel effect that will increase the collateral value and lengthen the treasury’s runway.
Because it is a staking proposal, whatever $APE is deposited will be locked for a customizable period. Such will ensure token, and NFT holders are one with the community’s long-term goals.
Individual depositors will benefit from gas-free deposits, minimize their taxable transactions, earn BABL Rewards, earn the highest yield on $APE, stake their BAYC for extra rewards, and dynamically switch strategies via community vote.
As of this writing, Babylon Finance is still waiting for Apecoin forum moderators to approve the proposal to go live in the forum.
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