Another Conversation about DRIP’s Sustainability, Part II
Doubting Thomas haz questions, I gots the answers! Read Part I
Thomas: I read about your conversation with Rich, and I think you left out a huge freakin’ hole!
Patrick Cryptozoa: Oh yeah? Tell me about it.
Thomas: So, I give you $100, $10 goes to the Tax Vault, $90 gets invested. And every day I hydrate/compound, so day 1 I throw the $0.90 back to recompound, so now I have $90.90 (actually, $90.81 after the 10% tax), and then I throw the next day’s $0.908 back to get recompounded/hydrated (after tax, it would be $0.8172) for $91.6272, and so on and so forth. It still doesn’t explain after a year I receive $3,400 from my initial $100.
Patrick Cryptozoa: Good. You’re about to turn the corner in your understanding. This whole time we’ve been talking about “Micro events” or how DRIP interacts with you personally. Now we can explore the guts of the system and talk about the “Macro events.”
First, take 5 minutes and watch this video:
Patrick Cryptozoa: Up to this point we’ve been talking in dollar terms. To get a true understanding we have to talk in the actual DRIP terms: DRIP and BNB. These are tokens decoupled from dollars. I only use dollars because it makes it easier to understand — at first. But, it’s really just a marker for the tokenomics interacting underneath.
Until DRIP is either bought, or sold, all other calculations such as hydrating and claiming are somewhat theoretical. Buying and selling DRIP is where the rubber meets the road.
The first DEX was the Fountain. there are 2 other major related DEXes: The Reservoir and Pancakeswap (PCS), but for now we’ll just discuss the Fountain.
DEX stands for Decentralized EXchange. It is decentralized in that it removes the third party filled with people such as a Bank, and replaces it with smart contracts that interact and governed based on a set of code. Within the DEX is a pool of funds. In DRIPs case the first Liquidity Pool (LP) is composed of DRIP and BNB.
When you Claim DRIP, it goes into your wallet, but once you sell DRIP, it doesn’t magically disappear; the DRIP gets deposited into the DRIP/BNB pool, and in return you receive an equivalent amount of BNB. Even though you sold your DRIP, the amount of DRIP doesn’t decrease, it increases the amount of DRIP in the DRIP/BNB pool. And when someone buys DRIP, they purchase it with BNB, which raises the amount of BNB in the DRIP/BNB pool, and reduces the equivalent amount of DRIP in the DRIP/BNB pool.
Patrick Cryptozoa: If you go to BSCScan and check out the Holders tab for DRIP, you’ll see that the percentage of the combined first 2 holders hovers around 85%:
Patrick Cryptozoa: This percentage has hovered around 85% since I first started on July 1st, 2021. It doesn’t fluctuate much. Because when folks sell DRIP, they actually deposit DRIP and receive BNB in exchange. US dollars don’t happen until you go to a Coinbase, or top off your Crypto.com card. In the land of DRIP there were originally only 2 currencies: DRIP and BNB. Now we have DRIP/BUSD with the Garden, and with the Farm we have even more pairs interacting, and deepening the pools.
Thomas: So, it’s more about the ratio then?
Patrick Cryptozoa: Yes! Catalyst has a great article explaining the DRIP/BNB ratio, and how that relates to the price of DRIP: https://cryptozoa.com/the-bnb-drip-ratio-the-metric-that-matters-706d523c4904
By multiplying the ratio (currently 0.31336094113778545) times the price of BNB (currently $405.65) we get the DRIP price of $127.11.
To get a more complete understanding of DRIP you’ll need to understand how it interacts in the Macro events such as the DRIP/BNB pool.
It’s the reason DRIP will never run out for payments, and why the percentage within the 2 major DEXes, the Tax Vault and PCS, always hover around 85%. Selling DRIP can then be seen as depositing into the DRIP/BNB pool and withdrawing BNB, and Buying DRIP can be seen as depositing BNB and withdrawing DRIP.
The interactions on a daily basis are simply calculations on an invisible spreadsheet until those 2 actions occur. And since there is only one place where DRIP can be exchanged, DRIP is either in the hands of individual wallets, or in the central DRIP/BNB pool.
Thomas: I think I’m starting to get it. I’ll need to think about this more. I can see how it is a beautiful system.
Patrick Cryptozoa: The beauty is in its elegance. It’s not simple. There’s complexity, but the Faucet only reveals the micro events, its elegance hides the complexity of what is going on underneath.
If you have any more questions, feel free to ask them in our Gateway Telegram group.
What is DRIP?
DRIP is a project that is able to provide passive income through smart contracts in Defi. It was created on the Binance Smart Chain, and the DRIP Token can be bought with BEP20 BNB.
The bedrock of DRIP is the feature of paying 1% on your investment per day. You can either pull that amount out and reer day, or you can “Hydrate” or recompound your earnings and compound the 1% against the new amount. By Hydrating you start to see the 3678% APYs by the end of the year (fees excluded for simplicity).
Come to Cryptozoa.com, check out the DRIP passive investment, and join the Cryptozoa Team!
How to Start
- Go to https://drip.community/fountain, and exchange BNB for DRIP.
- Go to the Faucet, and enter a Buddy address in the Referral section. Consider adding the Cryptozoa team member Bruno’s address for your Buddy: 0x7c806f431efd2b46c494d5dd6121a755b2b41042
- Deposit at least 1.12 DRIP (Ensure you have 0.05–0.1 BNB for transaction fees.)
You’re setup on DRIP. Get ready to receive 1% daily! But, do come back regularly to hit that hydrate/recompound button!
Cryptozoa Telegram — https://t.me/joinchat/PbTulqLoCmAzZmQx
DRIP Lightpaper — https://www.docdroid.net/0i3RJTu/drip-lightpaper-pdf
DRIP CONTRACT LINK — https://bscscan.com/token/0x20f663cea80face82acdfa3aae6862d246ce0333
NOTE: The amount Deposited is not withdrawable. In exchange you receive 1% of that staked amount on a 24 hr basis for the next 365 days, which can be rehydrated/compounded, or claimed.
The Animal Farm — https://theanimal.farm
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Nothing in this article is intended to constitute investment advice. Neither the author nor the publication takes any responsibility or liability for any investments, profits or losses you may incur as a result of this information. Readers are encouraged to perform their own due diligence and research, or consult a licensed financial advisor or broker before making any and all investment decisions. This content is intended for general informational and educational purposes only. Though the author strives for accuracy, the data contained within the article cannot be relied upon. The author may own cryptocurrencies and tokens discussed in the article. The article may contain affiliate links.
