Ribbon Finance (RBN) is an advanced suite of decentralized financial (DeFi) products made available to customers via blockchain technology. Ribbon Finance blends futures contracts, options, and fixed interest to increase returns for clients, as detailed in the platform’s whitepaper.
Ribon Finance (RBN), the platform’s native cryptocurrency, was originally designed as a governance token. The RBN token was used to monitor the system’s evolution by collecting input from users on key features, such as the fee structure.
As time progressed, however, the development team came up with alternative uses for the RBN coin within the Ribbon Finance ecosystem.
Continue reading to learn more.
How Does the Ribbon Finance (RBN) Protocol Work?
Ribbon Finance was started with the main goal of helping traders get into the DeFi market by using structured financial solutions. To help traders generate income, structured products combine many assets and financial instruments into one convenient package.
Often, these funds are linked to an index or a diversified portfolio of assets by product design professionals so that their clients can meet their unique risk-return objectives. Ribbon Finance developers employ financial engineering to design financial solutions that would provide returns for investors over the long term.
Moreover, the Ribbon Finance protocol has automated numerous options strategies using option vaults based on smart contracts. The protocol is decentralized and built on top of the Ethereum (ETH) blockchain and uses two fundamental products named Theta Vault and Theta Vault Yearn.
Theta Vaults are online safes where users can store cryptocurrency and earn interest based on the value of their holdings. It’s easy and not too expensive to use these vaults since the gas fees are lower when fewer transactions are made in bulk instead of many small ones. The user only needs to put money into their account, wait for payouts, and then take their money out. Smart contracts take care of the rest.
In turn, the platform is able to make high-end financial instruments more accessible to the general public.
What Is Ribbon Finance (RBN) Used For?
Up until very recently, Ribbon Finance RBN functioned solely as a “governance token.” This meant it could only be used to vote on governance proposals, such as modifying fee models, allocating treasury money, developing liquidity mining programs, and other related themes.
With the latest development of the Ribbon Finance platform, all existing and future Ribbon Finance products have been bundled into one token, the RBN, which powers the staking architecture of the platform as one of the most vital aspects of its functioning.
To be more specific, RBN holders can stake their RBNs on the platform in return for Staked Ribbons, denoted by the symbol sRBN. Instead of relying on ad hoc agreements, the sRBN leverages on-chain governance to implement the proposed changes automatically.
In many DeFi efforts, token holders don’t see a real benefit from the governing capacity of the tokens, which leads to low voting turnout and an overall diminished interest in the asset.
Therefore, the developers behind the sRBN coin decided to construct it in such a way that the voting power of long-term users would increase proportionally with the amount of RBN tokens they staked.
Where to Buy Ribbon Finance (RBN)?
Coinbase, Gate.io, and Uniswap (V3) are currently some of the most prominent trading platforms through which you can invest in some RBN tokens. If you want to expand your cryptocurrency trading choices, our in-depth evaluation of the best crypto exchanges can help you get started.
How Long Has Ribbon Finance (RBN) Been Around?
Julian Koh, a former software developer at Coinbase, is one of the people that started Ribbon Finance. The Ribbon team publicly announced the platform and Ribbon Finance (RBN) token on February 15, 2021.
The first part of the project consisted of releasing sRBN tokens around the end of 2021. The project’s second phase, which included more functionality, was launched in 2022.
What’s Controversial About Ribbon Finance (RBN)?
Ribbon Finance finds itself in the heart of a controversy almost immediately following the distribution of free RBN tokens through an airdrop.
To be more specific, it was reported that 5 months after the airdrop, a supporter of the project, the crypto venture capital firm Divergence Ventures, had allegedly misused the airdrop to obtain a considerable quantity of RBN tokens.
Eventually, these tokens brought Divergence Ventures almost $2.2 million in Ether (ETH). These allegations were later confirmed by Ribon Finance’s co-founder Julian Koh.
As a result of Ribbon Finance’s leadership’s conversation with Divergence, the company had voluntarily decided to contribute 1.35 million RBN from its starting capital to groups working to improve the financial services sector.
The Ribbon Finance DAO held this RBN allocation until recently, when it was transferred legally to the appropriate parties.
How Many Ribbon Finance (RBN) Coins Are There?
There are 1,000,000,000 RBN tokens available from Ribbon Finance. Ribbon Governance’s community distribution amounted to only 3% of the overall supply, which was enough to start this crypto initiative.
Also, four million RBN coins were dispersed across four different platforms based on the Ethereum blockchain (Charm, Hegic, Opyn, and Primitive). Tokens worth 21 million RBN were given out to clients that utilize Ribbon Finance’s products, while 5 million RBN were given out to the Ribbon Finance Discord community members.
Can RBN Be Mined?
It is impossible to mine RBN tokens in the same manner as other cryptocurrencies because the Ribbon Finance token is built on the Proof-of-Stake (PoS) Ethereum blockchain. Users are instead given the option to stake their RBN tokens to receive an incentive.
Market Cap and Price History of Ribbon Finance (RBN)
Ribbon Finance’s (RBN) cryptocurrency is currently ranked #189 on CoinMarketCap, with a total market worth of $141,774,645. Currently, one unit of Ribbon Finance is worth about $0.266095 USD, while the 24-hour trading volume is approximately $4,231,917 USD.
Biggest Competitors of Ribbon Finance (RBN)
EthosX is one of Ribbon Finance’s most significant rivals in the market. EthosX (YC S22) is another example of a decentralized financial platform focusing on crypto derivative products and institutional frameworks.
By allowing users to keep derivatives in the form of tokens in their wallets and trade or send those tokens to anyone at any time, the company’s technology eliminates the need for third-party intermediaries, such as centralized exchanges, brokerages, depositories, clearinghouse institutions, and CSD partners. As a result, users can profit handsomely by taking advantage of the crypto market’s extraordinary volatility.
What Does the Ribbon Finance (RBN) Project Road Map Look Like?
In order to offer RBN holders a sustainable and long-term utility, the Ribbonomics approach merges a number of the most promising features of numerous existing DeFi initiatives. The Ribbonomics team is currently researching these projects.
To achieve this goal, vote locking incentivizes holders of RBN tokens to keep their tokens locked for longer periods. This allows holders to have a stronger influence within the Ribbon ecosystem and receive a significant portion of the money generated by the protocol.
Those who own RBN and keep their coins in a vault managed by Ribbon Finance will be eligible to reap the benefits of protocol backstopping since it acts as a safety net for the network.
The Ribbon team also releases Meta Vaults to make it easier for developers to browse and modify preexisting vaults. Meta Vaults users will be able to make money from buying and selling vaults by adding new features on top of them and splitting the fees for maintenance and execution.
The members of the Ribbon cryptocurrency community are working toward developing a diverse selection of option vaults based on various token and investment techniques. After building and overseeing a select number of vaults, the Ribbon Finance team has signaled its plan to make way for a community-driven investment environment.
Pros and Cons of Ribbon Finance (RBN)
Pros
- Incorporates the Ribbon Finance products;
- Serves both as a governance and utility token;
- You can earn passive income by staking the RBN token;
- Available on some of the most prominent crypto trading platforms.
Cons
- Has been involved in controversy soon after its initial airdrop.