“When it is dark enough, you can see the stars.”
-Ralph Waldo Emerson
2022 dealt seemingly unending challenges to the world of DeFi, felt by users and protocols alike. TempleDAO has certainly faced its fair share, but challenges have never been show-stoppers for the Temple Team. Enduring the ups, downs, twists, and turns, we’ve punched our way through it all, striving for continual improvement along the way.
Challenges have revealed opportunities, and those opportunities have been our North star as we’ve navigated this tumultuous market. As a result, a brighter path forward for the $TEMPLE token has come into focus, and we’re excited to travel it with you.
Let’s talk about the new $TEMPLE that’s emerged from the volatile storms of this bear market: a stable, downside-protected token that appreciates in value over time.
Stable– But Not a Stablecoin
Price stability is obviously a major factor in the attractiveness of stablecoins–particularly in markets as rough as 2022. However, unlike a stablecoin whose price is pegged, $TEMPLE offers stability as well as a steadily appreciating price over time.
Stability with gradual price appreciation…sounds like $FPI and similar tokens?
On the surface perhaps, but that’s about where the similarities end. One of the important things that differentiates $TEMPLE is the following distinction: The price of $TEMPLE is indexed to transparent and tangible Treasury holdings that grow over time through multiple revenue streams, rather than being pegged to an arbitrary number. And furthermore, there is no cap to $TEMPLE’s upside.
For the user, the TL;DR is– As the Temple Treasury grows, so does the $TEMPLE price. At the same time, the token is also protected from downside price action.
The $TEMPLE holder reaps the benefits in a simple, safe, and frictionless way. Let’s take a closer look at how we accomplish this.
At the foundation of the new Temple is our $TEMPLE/$bb-a-USD liquidity pair on Balancer Finance, coupled with our novel mechanic RAMOS.
Random Automated Market Operations Support (RAMOS for short) is our custom-built, AMO-styled liquidity manager for our $TEMPLE/$bb-a-USD LP. This novel technology enables the Temple Protocol to both stabilize the trading range of the $TEMPLE token as well as index the token price to our ever-growing Treasury.
Here are the basics under the hood:
Treasury Price Index
RAMOS performs its functions using a metric called Treasury Price Index (TPI) as its baseline. TPI could be thought of as an appropriate minimum target price for the $TEMPLE token relative to the value of the Temple Treasury’s holdings. TPI is neither a ceiling nor a floor for the $TEMPLE price, but rather a reference point that RAMOS uses to guide its efforts.
When the $TEMPLE price trades below the TPI, RAMOS steps in to protect price by single-side withdrawing $TEMPLE from the LP to raise token price closer to the TPI.
When the $TEMPLE price trades above the TPI, organic price discovery is possible. However, at a defined premium threshold above TPI (referred to as the TPI Upper Bound), RAMOS may either recapitalize the $TEMPLE side of the LP or single-side withdraw stablecoins from the LP to recapitalize the Treasury. Both have the effect of stabilizing $TEMPLE price above TPI, with the latter helping to grow the Treasury as well.
As the value of the Treasury grows over time, TPI and subsequently the price of $TEMPLE grows as well. This token price appreciation as well as downside price protection is all accomplished through RAMOS’ automated liquidity management operations. For the tech-heads out there that want a deeper dive into the inner workings of these mechanics, check out the Temple Gitbook.
Simplicity for all Templars
While the technical details lying under the hood of this token price stability model are complex, the user experience is certainly not. In fact, it’s never been simpler for the $TEMPLE holder. There is no staking, no lock-ups, no complicated steps whatsoever.
The user only needs to buy and hold $TEMPLE. It’s just that easy. All the work is done for you, and you’re rewarded through appreciation of the $TEMPLE price. Head over to the Temple dApp to load up your $TEMPLE bags, then chill with the rest of the community in Discord and watch TPI rise over time.
Light from Darkness
Yes, 2022 has been a rough ride for everyone. But bear season is a time for building, and that’s what we’ve done all the way through. In the face of adversity, a new $TEMPLE has been born– and we see it becoming the wrapped Treasury token of choice for any user who is interested in a token product that has steady price growth in all seasons.
The RAMOS contract has passed rigorous internal reviews as well as an audit by Peckshield, and is now live. We look forward to forging ahead with the community as we continue building out the broader Temple ecosystem.