Sommelier Liquidity AMA with Dereek69 & Shalaquiana from BIOPset

Follow Taariq Lewis as he interviews some of the up and coming projects in crypto, to gain insights on becoming a profitable Liquidity Provider for Uniswap V3. BIOPset is the the on-demand, censorship-resistant, peer-to-pool binary options settlement protocol. Today we were joined by Core Developer Shalaquiana and Head of Tokenomics Dereek69.

BIOPset, New Binary Options Project, Offers Opportunities for Liquidity Providers

Binary options is a complex space. On June 11, it got a little more promising for liquidity providers when BIOPset, a project on binary options, launched Uniswap liquidity rewards for liquidity providers for the BIOP Ethereum pair on Uniswap v2 on Ethereum blockchain. Co-founders Dereek, Head of Tokenomics, and Shalaquiana (“Sha”), Head of Development, discuss their project.

Sha says: “We are co-founders of BIOPset. Our name is a version of ‘binary options settlement’ on Ethereum blockchain. It’s entirely public, entirely decentralized from day one. All of the functionality is on-chain, from the liquidity to option creation to option settlement, which is one of our most defining features. We have designed our system so that anyone, anywhere can earn a risk-free income by helping settle other people’s options. That’s our key justifying point. And, our options are currently built on top of Chain Link’s oracles.”

Dereek observes: “Our main benefits against our competitors that are centralized binary options currently are that we have very low fees, about 10 times lower than the centralized competitors as they usually reward 85-90 percent of the win to the betters, while we reward up to 98 percent. And, we cannot be shut down or regulated because even if the website doesn’t work you can always use BIOPset directly from the Ethereum contracts. And we have no limitation regarding the size of the options. Most platforms have requirements and so they will rule out a lot of people that cannot afford a minimum amount. Any option can be opened on BIOPset on the lower side. On the upper limit, the only limit we have is regarding the liquidity in the pool.

Right now BIOPset is made possible by three types of users, Dereek explains:

“The first is, of course, traders. They open and close options and they don’t need a counterparty because the liquidity providers are the counterparty for the traders and they are rewarded with the BIOP token for providing liquidity to the platform. And, then there are the settlers that will close every open option when it’s time to close them and they will earn a share of the fee by doing so.”

The competition

Over the past few weeks, BIOPset’s team has been diving in and analyzing competitors. Sha observes:

“A large number of our ‘competitors’ don’t have products. Of the ones that do, the ones that are closest to us are Spectre AI, except they require accounts, they require deposits before you can make a trade, which removes all of the centralized aspects we’re going for. In addition to them there’s Value Network Live. But as far as I can tell they’re mostly operating on Binance Smart Chain and not Ethereum. They also seem to have larger option timelines than we focus on. Our options are focused on shorter time lines. The only remaining competitor that seems to have any type of working product is Divergence and they’re definitely our biggest competitor.”

The edge is that 98 percent of fees come back to liquidity providers. Dereek explains::

“When they are out of the money the entirety of the option goes to the liquidity provider, while when they’re in the money 98% of the options goes to the winner of the bet.

Progress and opportunities for liquidity providers

Currently, BIOPset is waiting for the code audit to launch its full platform on which participants will be able to provide liquidity for the BIOPset platform. Dereek says:

“We launched the Uniswap liquidity rewards on June 11, where we will reward liquidity providers for the BIOP Ethereum pair on Uniswap v2. Learn more by coming to our Discord. Website: biopset.com.”

Looking ahead, Dereek considers Uniswap v3 in BIOPset’s future. He says:

“We are looking to give rewards to Uniswap v3 but we’re not looking to do this right now. Our plan is to wait for Uniswap v3 on Layer 2 or for the locking period to end and to look at the market and decide what to do then. Currently, the locking period was three months starting from listing, which was in May.

“Currently, the plan is for the launch to incentivize trading as well as liquidity providing the most because we need volume for the liquidity providing to be effective. As soon as we have enough volume or the rewards for the liquidity providers are maybe a bit lower ahead of time, we are going to probably change the fee structure to reward them more for out-of-the-money options."

Active participation in the DAO is something already structured from the outset in BIOPset. A commitment to community is also a key pillar for why this will be successful.

The market opportunity: Freedom, access to more fees, and fewer intermediaries

Sha describes the current market for his company and the opportunity it presents for liquidity providers. He/She says:

“The current binary options centralized market is $1.25 billion a year globally, and our options are offering a higher return than any centralized binary option available anywhere. The highest centralized binary option returns are 90% and we offer up to 99% if you settle your own option. Which, we see is a dramatic step up for users who want to trade options and not lose their fees to centralized oligarchies dominating the binary option world.”

“Our team has already grown a lot,” notes Dereek. “Originally, it was just me and Sha and now we are I think six or seven members working on it.. And, I’m pretty sure we are going to grow quite a lot more in the following months. We are already looking for a web developer.

Sha encourages front-end web developers to reach out. He/She says:

“If you’re listening to this and you’re a front-end web developer, especially with experience building PWAs or SPAs, then come and contact us. We are ready to hire immediately. Outside of that our main focus is to grow the community through utilization rewards. They are set up so that the majority of buyout tokens in existence will be distributed to the users of the platform. We want to make sure that the people who care about it and want it to exist are the ones that control it and ultimately will be administering it through the settlement long-term.

“One thing I’d like to say is there are a number of competitors that exist in the decentralized space that don’t have products -- I’m not going to name them -- but they have tokens, they’ve been in development for twice as long as we have with no product, they are not ready, they don’t even have a test net version and their tokens are valued at 20x the current price of our buyout token. So, if you’re looking for some alpha, this is it.”

Considering price and BIOPset’s active community this should be one to watch. If you’re looking for BIOPset on Uniswap v2 you can check out Sommelier’s v2 version and, of course, as staking rewards come online we will be there for Uniswap v3 as well.