Introduction
OVN is gaining more and more attention for its strong price performance, special tokenomics, and lucrative farming opportunities. This article explores each of these aspects, shedding light on why farming USD+/OVN at 3-digit APRs is nothing short of a money-printing machine for liquidity providers and yield farmers.
OVN is the native token of the Overnight Finance ecosystem. It plays a crucial role in promoting the stablecoin USD+, facilitating a rigorous, decentralized risk management process, and providing lucrative yield farming opportunities. OVN holders can leverage their tokens in various ways within the ecosystem, including staking and providing liquidity, which in turn contributes to the token’s value appreciation. We sometimes want to call it as a ‘stablecoin loosely pegged to TVL.’
OVN Price Performance
Over the last three months, OVN has experienced a significant price appreciation, trading from approximately $18 to ~$30. OVN’s price action has demonstrated stability and resilience, making it an attractive option for liquidity providers (LPs).
This stability is a result of several factors:
- utility within the Overnight Finance ecosystem
- adoption
- strategic distribution of its liquidity.
A significant contributor to the rise in OVN’s price is due to the inherent incentives and use case for Overnight Finance ecosystem and the success of the version one delta-neutral and version two perpetual based delta neutral strategies.
Moreover, as the Total Value Locked (TVL) of Overnight Finance increases, particularly in its main offering of stablecoin products, we aim and anticipate growth not just in the protocol’s revenue, but also in the price appreciation of OVN. A substantive portion of the protocol’s revenue is being utilized to incentivize various Decentralized Exchanges (DEXes), particularly Aerodrome on Base.
This not only enhances the appeal of the platform to Liquidity Providers (LPs) but also contributes to the stability and growth of OVN’s price. As LPs earn more rewards, they are more likely to hold onto their OVN tokens, reducing the available supply and consequently driving up the price. This effective use of the protocol’s revenue to stimulate engagement within its ecosystem is a testament to Overnight Finance’s innovative approach, further driving the value of OVN.
Overall, the recent price action of OVN is a testament to the successful strategies and continuous growth of the Overnight Finance ecosystem.
Farming USD+/OVN at 3-Digit APRs
One of the key benefits of OVN is the chance to farm USD+/OVN with very high returns. Think of it like a money-making machine for those who provide liquidity (LPs). LPs who put their OVN/USD+ into the farm get rewards in form of the DEX tokens such as $AERO for Aerodrome and $CAKE for PancakeSwap. This high return doesn’t just give LPs extra rewards, but also encourages more people to join the OVN ecosystem, which in turn increases the value of OVN tokens.
Furthermore, a critical aspect of the OVN token’s function is the alignment of community incentives towards conservative risk decisions. Holders of the OVN token have the power to influence the protocol’s risk management. They are rewarded for supporting conservative risk decisions and have the capability to veto aggressive ones. This feature not only empowers OVN holders with more control over their assets but also ensures the overall robustness of the Overnight Finance ecosystem. It fosters a community that is actively engaged in maintaining the stability and security of the platform.
It’s important to note that the price of OVN is correlated with our Total Value Locked (TVL). Thanks to our constantly growing number of partners and more innovation with our underlying revenue-yielding strategies, we anticipate the price will continue to rise.
How to Join the Opportunities
Here’s a step-by-step guide on how you can join and benefit from the different opportunities OVN provides:
1. Becoming a Liquidity Provider on Aerodrome
a. Visit the Aerodrome platform and connect your wallet.
https://aerodrome.finance/liquidity?query=ovn
b. Choose the OVN token pair you wish to provide liquidity for.
c. Input the amount of OVN and USD+ you wish to deposit.
d. Confirm your transaction on your wallet. Once it’s successful, you will start earning rewards.
2. Staking on Extra Finance
a. Navigate to the Extra Finance platform and connect your wallet.
b. Choose the OVN lending option.
c. Determine the amount of OVN tokens you wish to stake.
d. Confirm the transaction on your wallet. You will start to earn additional rewards based on your staked amount.
NOTE: Sometimes, due to high demand on the lending pool, there could be a delay in the withdrawal of your deposited OVN until the loans are repaid by the borrowers.
3. Becoming an Insurance Provider on the Insurance Vault
a. Visit the Insurance Vault section on our DApp and connect your wallet.
https://app.overnight.fi/insurance
b. Choose the insurance pool you wish to join. Currently, you can select either “Optimism” or “Arbitrum”
- Each chain has different methods of providing premiums thus it has different risk profiles.
c. Input the amount of OVN tokens you want to provide as insurance.
d. Confirm the transaction on your wallet. Now, you’re an insurance provider, securing your staking of OVN while earning premiums.
Remember, each of these strategies presents an excellent way to maximize your participation and profits in the OVN ecosystem.
OVN Tokenomics
Overnight Finance’s OVN token has many uses within the Overnight system. It helps promote USD+, a stablecoin, and helps set up a strong, decentralized process for monitoring and managing risk. The token is important for encouraging the community to make careful risk decisions. It rewards support for these decisions and stops aggressive ones. OVN holders can also put their tokens in the Overnight Insurance Vault, swapping them for insurance premiums. This vault contributes to the scaling of Overnight while maintaining an attractive yield for USD+ holders, creating upward pressure on OVN’s value.
The OVN token distribution is fixed at 1,000,000 tokens, with no plans for additional emissions. The distribution is as follows:
- Pre-seed investors: 8.5% with a 6-month cliff followed by 24 months of linear vesting.
- Team: 25.0% with a 6-month cliff followed by 24 months of linear vesting.
- Pre-sale: 2.5% with 25% on the end of sale and 75% over 4 weeks of linear vesting.
- Insurance fund: 20.0% with 10% on the end of sale and 90% over 6 months of linear vesting.
- Treasury: 44.0% with 10% on the end of sale and 90% over 6 months of linear vesting. The treasury is utilized for seeding liquidity to OVN pools and incentivizing USD+ pools, while the insurance fund is allocated for staking into specific Insurance Vaults.
The tokenomics of OVN are designed to maximize the token’s value over the next 30 months, offering multiple strategies for benefiting from the token. These include buying and holding OVN, staking OVN/USD+ LP for additional yield, and staking into the Insurance Vault for insurance premiums. Each strategy has its benefits and potential risks, such as impermanent loss for LPs and potential downside in case of a strategy loss in the Insurance Vault.
Conclusion
In conclusion, OVN’s impressive price performance, unique tokenomics, and high yield farming opportunities make it a lucrative option for investors and crypto enthusiasts alike. Farming USD+/OVN at 3-digit APRs is indeed a money-printing machine for LPs, with continuous redirection of operational revenue to reward the liquidity providers, offering a tangible way to maximize their crypto holdings.
Our long-term goal is to keep the OVN token’s price steady for people who provide liquidity. At the same time, we aim to give them substantial rewards. We also want to improve the overall health of our protocol by attracting more total value locked (TVL) to our main stablecoin products. By doing this, we believe the price of OVN will naturally increase.
As the world of cryptocurrency continues to evolve, it will be interesting to see how OVN continues to strengthen its position in the market.
