Optim Initial Liquidity Event (ILE)

Optim Labs
6 min readOct 27, 2023

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The ODAO approved and voted to move forward with Optim’s Initial Liquidity Event (ILE).

We are excited to commence this crucial step in Optim’s journey. The support and enthusiasm of the Cardano community has been incredible, and we look forward to continuing to build a more equitable and decentralized financial future together.

This article details the process, timeline, and mechanics of the ILE. If people have further questions and need clarification on any aspect of the ILE don’t hesitate to join us on Discord. The general channel is a great place to learn about anything Optim related along with our customer support ticket system.

Overview

Optim’s Initial Liquidity Event (ILE) will distribute the OPTIM and OPTMiz tokens to participants.

Optim will allocate 11,000,000 OPTIM (11% of total supply) to its ILE.

Another 4% of potential supply, if converted, in the form of 4,000,000 OPTIMiz tokens, will also be distributed.

More detail on OPTIMiz will be released, but when paired with OPTIM/ADA LP tokens OPTIMiz will be convertible to OPTIM. OPTIMiz tokens are a bonus to be automatically received with each OPTIM.

11,000,000 OPTIM

– 8,000,000 OPTIM tokens will be available to ILE participants —

- 3,000,000 OPTIM tokens will be paired with ADA for initial Protocol Owned Liquidity (POL) on TBA DEX.

4,000,000 OPTIMiz
Distributed pro rata, with each 1 OPTIM token receiving a bonus of 0.5 OPTIMiz.

The OPTIM <> ADA Liquidity Pool with 3,000,000 OPTIM and 1,500,000 ADA will be created on To-Be-Announced (TBA) DEX when the ILE ends. Immediately following, OPTIM tokens will be sent to ILE participants. Both the DEX LP creation and OPTIM distribution to participants will occur within 24 hours of ILE ending.

*OPTIM and OPTIMiz tokens received by the community will not be in the form of LP tokens.
It is up to individuals to decide what to do with the OPTIM tokens received via the ILE. The LP tokens in TBA DEX will be created by pairing the amount of ADA allocated to the ADA/OPTIM pool with the 3% of OPTIM supply reserved for this purpose.

Process

On October 27th, 2023 the OPTIM and OPTIMiz tokens will be sent to the ODAO treasury owned wallet for distribution. The ODAO treasury will then push these tokens to the distribution system for the ILE.

The Initial Liquidity Event (ILE) will begin October 28th, 2023 12:00 UTC and end 48 hours later

The ILE consists of 3 phases: First Swap Phase, Second Swap Phase, and Settlement Phase.

The First Swap Phase and Second Swap Phase each last 24 hours.
The Settlement Phase will execute within 24 hours.

1) First Swap Phase — an allotment of OPTIM is available in exchange for ADA
2) Second Swap Phase -an allotment of OPTIM is available in exchange for Optim Bond Tokens
3) Settlement Phase — all orders are settled, demand between phases is balanced, DEX Liquidity Pool is created, and then participants’ OPTIM and any excess funds are distributed.

First Swap Phase
Begins October 28th 12:00 UTC | Ends October 29th 12:00 UTC

The first swap phase allows participants to exchange ADA for OPTIM tokens.

5M OPTIM are available in exchange for 2.5M ADA during this phase.

Orders from participants will be pooled together, and distributions will be allocated on a pro-rata basis. Each order’s settlement will be based on its proportion to the total orders received during this phase. This approach is designed to mitigate the influence of frontrunning bots and maintain order throughout the Initial Liquidity Event (ILE), rather than operating on a first-come, first-serve basis. Once an order is submitted it can’t be reversed or adjusted.

If more ADA is sent than OPTIM available, participants will be refunded excess ADA beyond their final pro-rata allotment. The excess ADA will be returned along with their OPTIM tokens after the Settlement phase.

Second Swap Phase
Begins October 29th 12:00 UTC | Ends October 30th 12:00 UTC

The Second Swap Phase allows participants to exchange Optim Bond Tokens for OPTIM

3 million OPTIM are available in exchange for 15,000 Optim Bond Tokens (1.5M ADA Face Value) during this phase.

Participants will submit orders with Optim Bond tokens, which will be aggregated into a collective pool. Distributions will then be allocated on a pro-rata basis. The settlement for each order will correspond to its proportional share of the total orders placed during this phase.

If more Optim Bond tokens are sent than OPTIM available in the second phase, participants will be refunded all excess Bond Tokens beyond their pro-rata allotment. The Bond tokens will be returned along with OPTIM tokens during the Settlement Phase.

Any unclaimed OPTIM from the Second Swap Phase will be allocated to the pool of available OPTIM for First Swap Phase participants. Similarly, any unclaimed OPTIM from the First Swap Phase will be allocated to the pool of available OPTIM for Second Swap Phase participants if it is oversubscribed. In both cases OPTIM will be distributed on the same pro-rata basis as a participant’s percentage of the total order of each Swap Phase pool.

Settlement Phase

The Settlement Phase is a concise window of time dedicated to finalizing order allocations and distributing tokens to Initial Liquidity Event (ILE) participants. During this phase, specific operations are carried out, including the reallocation of any excess tokens from the second phase back to the first, along with adjusted pro-rata calculations for token distribution.

The tokens will be deposited into TBA DEX Optim <> ADA Liquidity Pool in this phase. The Pool will be created before OPTIM tokens are sent to ILE participants.

Both the DEX Pool creation and the distribution of OPTIM to ILE participants will happen within 24 hours of the ILE ending.

Terms:

1 ADA sent to the ILE contract will be exchanged for 2 OPTIM and 1 OPTIMiz

Exchange Rate:

.50 ADA = 1 OPTIM | 1 ADA = 2 OPTIM + 1 OPTIMiz (bonus)

  • ADA can only be exchanged for OPTIM (+OPTIMiz) in 1 ADA increments.
  • OPTIM and OPTIMiz tokens will be received at the end of ILE.
  • The available supply and exchange rate are fixed. If less than 4MM ADA is exchanged, not all OPTIM will be distributed.
  • The exchange of ADA for OPTIM is one way and final. There is no pool withdrawal or adjustment period once orders have been submitted.

Optim Bonds

Phase 2 accepts only Optim Bond Tokens in exchange for OPTIM.

The ADA value designated to each Bond presumes that all potential interest has already been paid, irrespective of the bond’s actual stage within its lifespan. This applies even if the bond is just a few epochs into its potential duration.

Each Bond Token equals 100 ADA face value + all potential accrued interest.
The value calculation assumes that a bond’s interest is paid to maximum duration.

Example:

A 6 month (36 epoch) Bond was issued at 7% APY to lenders.
At ILE the Bond is 3 months (18 epochs) into its duration.

At this point, the Bond is technically worth 102.33 ADA
(1.75 ADA interest accrued + .58 ADA interest buffer)

If the Bond reached its maximum duration of 6 months, the redemption value would be 103.5 ADA. In the example given, Optim’s Initial Liquidity Event (ILE) system would assign a value of 103.5 ADA to the bond. This valuation would be used to determine the amount of OPTIM tokens a participant would receive in exchange for that specific bond.

*Bonds issued and purchased after 10/20/2023 are not eligible for ILE exchange

Liquidity Allocations

8,000,000 OPTIM (+ 4,000,000 OPTIMiz)
Will be exchanged for 4,000,000 ADA of Protocol Owned Liquidity POL

Allocation of all Optim POL:

- TBA DEX 1,500,000 ADA < > 3,000,000 OPTIM
- TBA DEX 1,250,000 ADA < > 1,250,000 OADA (minted from ADA)

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