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Introducing Lockdrop + LBA: A Novel Token Launch Mechanism

Dec 2, 2021 · 1 min read

By Jose Maria Macedo, Yan Liberman, CFA, CAIA, Luke Saunders, and Gabriel Shapiro

(Full PDF Report below, but for convenience we’ve included a 15 minute video where we walk through this mechanism)

At Delphi, we’ve spent a long time analyzing and designing token launch mechanisms. Overall, while the space has come a long way since the ICO fixed price sales, we still believe there is significant room for improvement.

As we helped two of our most recently incubated projects–Mars and Astroport–think through their token-launch mechanisms, we couldn’t find any existing structures that adequately satisfied all our design objectives. As a result, we decided to revisit token launches from first principles with the goal of coming up with something tailored to our goals. The result is what we’re calling the “Lockdrop + Liquidity Bootstrap Auction” which will be trialed by Astroport in December and Mars soon after.

In this paper, we explain the design goals we were trying to optimize for and why we believe this structure is the best token launch mechanism to achieve them.