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PotionLabs Kicks off Auction for ‘Potion Unlock’ - a Novel NFT Game to Open Source a DeFi Protocol

The Potion Unlock game is a social experiment to bootstrap a decentralized community around a DeFi protocol.

PotionLabs Kicks off Auction for ‘Potion Unlock’ - a Novel NFT Game to Open Source a DeFi Protocol

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PotionLabs, the developers of the new risk management layer Potion Protocol, have announced the launch of the Potion Unlock NFT auction. Those who purchase NFTs in the auction will be able to participate in the Potion Unlock game, working with other community members to release the Potion Protocol into the public domain. With this one-of-a-kind strategy based on “aggressive decentralization”.

Potion Labs Seeks to Avoid the Dangers of a Traditional Project Launch

The mechanics of the game are simple. The code base of the entire project has been stored in IPFS and protected with a strong password. This password has then been split into segments of various lengths and will be distributed across 10 thousand unique NFTs.

In order for the code to be finally decrypted and made public, participants will have to collaborate to bring enough of the pieces together. The game itself is totally open-ended: players will have to self-coordinate – without the input of Potion Labs – to find their own solution to the problem.

Once the protocol’s file is decrypted and released into the public domain, a community with ‘skin in the game’ and web3 operational capabilities will have been formed. This community will then have power and stewardship over the future of the Potion Protocol as a public good.

The majority of Potion NFTs will be sold to the public via a Dutch-style auction starting 14th March (whitelisting already live) where high profile DeFi and NFT participants are expected to take part.

To strengthen the participating community, two Potion NFT rarities (Kelly Knights and Wise Wizards), have already been distributed through a $12M private sale last January. These were bought by prominent DeFi players such as Polychain, Placeholder, Maven 11, Pantera, The LAO, MetaCartel, Parafi, Spartan and Robert Leshner, among others.

Finally, Potion’s early community members, also received a generous allocation of Potion OG NFTs at no cost, in recognition for their early community support and inspiration. A significant number of OG NFTs have also been made available in the form of airdrops to 1 thousand leading members of prominent DAOs, with the goal of building a high quality community around the project.  

PotionLabs is seeking to accomplish several goals with this launch model. The developers are deep believers in decentralization and designed Potion Unlock to transfer control of the Potion Protocol to the community. In this way, the approach delivers “aggressive decentralization’ and avoids power becoming concentrated in the hands of the few, ensuring that it is instead spread across the community.

This form of protocol release is also meant to create a commercially viable way for PotionLabs to continue to finance its research work, while operating within clear regulatory guidelines. PotionLabs also hopes this novel release model can be of use for other Web3 projects.

Guillem Mosquera, PotionLabs Co-founder and CTO, said:

“We are excited about the opportunity to introduce a new class of services built from the ground up by the community for the community. We believe in a community-first approach to creating radically new technology aimed at helping users in DeFi manage the risk of their assets in a simple and reliable way.”

Jordi Muñoz, PotionLabs Co-founder and CEO, added:

“We are deeply grateful to the community around the project who decided to support our vision and team. We are experimenting with new approaches to open source development for web3 and are lucky to have a visionary community willing to fuel and support our exploration. We are excited for them to continue playing a key role in the project’s community.”

Chris Burniske, Partner at Placeholder, had the following to say:

“Extremely sophisticated on the backend, surprisingly simple on the frontend, Potion ushers in a new era of risk management for DeFi liquidity providers (LPs) and consumers. By using the Kelly Criterion, Potion allows LPs to optimally price options according to their desired risk and yield parameters. Then, by aggregating all individual LP curves, Potion offers the best-priced options to the consumer. When people say DeFi 2.0, Potion sits at the top of that list.”

PotionLabs is a web3-native research and software development company that has developed a robust risk management layer for crypto assets, the Potion Protocol. It pioneers a new risk pricing model based on the Kelly Criterion, which results in long-term survival mathematical expectations for LPs, and deeper, more reliable liquidity markets for users. The release of the Protocol’s code is launching shortly through the Potion NFT Unlock game.

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