The Umbrage White Paper
Did you honestly think we’d have a white paper for a meme coin?
The subjectivity of the impermanent loss from staking an LP (liquidity provider) in a farming reward generator is a common misconception with the strong APY average. We’ve seen so many new cryptocurrency prospectors get pulled into a high-APY LP-farming pit, feeling hopeless as they’re squeezed out by earlier buyers with higher staking rewards, thanks to the explosion of DeFi. We’ve all been there where seeing those gleaming six-digit figures tempts us to jump in.
Almost always, however, the token suffers from an unavoidable value bubble, which is followed by a burst and imminent market crash. As a result, we’ve seen a widespread adoption of static rewards, also known as reflection, a distinct idea that aims to remove the problems created by farming rewards.
Static incentives address a slew of issues. To begin with, the size of the reward is contingent on the volume of the token being exchanged. This mechanism aims to relieve some of the downward sell pressure on the token that has been generated by early adopters selling their tokens after farming insanely high APYs. Second, the reflect system allows holders to keep their tokens in order to earn higher kick-backs, which are calculated as a percentage of the total tokens owned by the owner.
Sometimes burns are essential, and sometimes they aren’t. In the early days, a continuous burn on a single protocol can be convenient, but it means the burn cannot be finite or regulated in any way. Burns that are managed by the team and promoted based on accomplishments help to keep the group updated and rewarded. The conditions and quantities of the manual burn can be advertised and monitored.
Umbrages’s secret sauce is Automatic LP. We have a feature here that serves as a dual-beneficial implementation for holders.To begin, the contract collects tokens from both sellers and buyers and adds them to the LP, establishing a stable price floor.
Second, the penalty serves as an arbitrage-proof device, ensuring that the amount of Umbrage is secured as a compensation for the owner. In principle, the additional LP provides stability by applying the tax to the token’s total liquidity, thus increasing the token’s overall LP and supporting the token’s price floor. This differs from other reflection tokens’ burn feature, which benefits only in the short term from the granted supply reduction.
The price stability of the Umbrage token LP mirrors this feature, providing holders with a solid price floor and cushion. The aim is to avoid larger dips in the price when whales decide to sell their tokens later in the game, which prevents the price from fluctuating as much as it would if the automated LP feature wasn’t in place.
All of this is in an attempt to address some of the issues with the new DeFi reflection tokens. For these reasons, we are sure that this model and protocol will triumph over obsolete reflection tokens.
Umbrage has three basic functions: Burn + Reflection + LP acquisition Each exchange is subject to a ten percent levy, which is divided in two ways.
- The 5% fee is redistributed to all current holders.
- The 5% fee is split 50/50, with half of the Umbrage tokens being sold into BNB by the contract, and the other half being immediately paired with the previously listed BNB and added as a liquidity pair on Pancake Swap.