bZx Protocol Coin Price & Market Data
bZx Protocol price today is $0.271319 with a 24-hour trading volume of $28,619,440. BZRX price is up 3.1% in the last 24 hours. It has a circulating supply of 140 Million BZRX coins and a total supply of 1.03 Billion. If you are looking to buy or sell bZx Protocol, Binance is currently the most active exchange.
What is BZRX?
BZRX is the governance token for bZx protocol and gives the users the rights to:
Claim a share of protocol fees
Claim a share of the Insurance Fund
Vote for representatives in the Legislative branch of the bZxDAO
Insurance fund: each BZRX token can be redeemed for a proportional amount of the insurance fund not already denominated in BZRX. This gives the BZRX token a fundamental value by being both backed by current assets as well as future cash flows. The insurance fund receives half of origination fees, fees from interest payments, and fees generated via trading.
A tokenized vesting token, vBZRX was created for presale participants with a vesting schedule of 4 years with a six-month cliff.
vBZRX have the following benefits:
Liquidity: Allows vested token holders to exercise their liquidity.
Fee Sharing: The vesting tokens earn fees that vest simultaneously with the tokens that earned them.
Voting: Vesting tokens have 50% voting power compared to BZRX.
The collected protocol fees are invested in Balancer pools, earning trading fees while mining BAL. There are two Balancer pools: an impermanent loss free stablecoin pool and an ETH+ERC20 pool for more volatile assets. By grouping assets with similar volatility together, impermanent loss can be minimized. The trading fee on each of the pools will initially be set according to the square of the historical volatility of the assets within the pool, the best known method for no-arbitrage parameterization.
As of the current version, stakers will be able to claim for the protocol’s fees in terms of BPT tokens or any other tokens (swapped through Balancer).
How to obtain BZRX?
What is bZx Protocol?
bZx is a protocol for borrowing, lending, and margin trading. Borrowing can be done through the Torque while the Fulcrum handles lending and margin trading.
What is Fulcrum?
Fulcrum is built on the bZx base protocol that allows both loans and margin positions to be tokenized. Tokenized loans, called iTokens, are given to users that lend their assets on bZx to earn interest on it. Tokenized positions, called pTokens, are given to users who make long or short trades on an asset.
Margin trading has two main aspects: leverage and shorting. When trading with leverage, a trader borrows assets to increase the amount of assets they are trading. By doing so, they magnify the gains or losses of their trade. The borrowed assets are known as a margin loan.
To obtain margin loans, traders put up assets that serve as collateral. The terms of the margin loan specify a collateral-to-loan ratio. If the trade falls below the specified ratio, the trade is liquidated and the lender gets repaid using the trader's collateral.
Margin trading also includes shorting. When shorting, a trader sells assets they do not own. The short trader borrows an asset and sells it with the expectation that the asset will lose value so that it can be purchased back at a lower price, netting the trader a profit.
In the context of Fulcrum, trading involves first borrowing from an iToken. There are two ways to borrow using Fulcrum and open a position:
Leveraged Long: For a 2x long ETH position, the pToken first borrows from a stable asset, iDAI, and then swaps that for ETH on KyberSwap.
Leveraged Short: For a 2x short ETH position, the pToken first borrows from the iETH token, then swaps that ETH for a stable asset (DAI) on KyberSwap.
The pTokens are perpetual, but positions are not. If a position loses too much value, or reaches the end of the loan term (28 days), it will be liquidated and a new position will be opened behind the scenes. Traders should be aware of the liquidation price of the pToken.
What is Torque?
Torque is a non-custodial platform for fixed rate, indefinite-term cryptocurrency loans. Torque loans are loans borrowed from the Fulcrum iToken lending pools. These lending pools have algorithmically determined interest rates based on supply and demand.
Torque loans function slightly differently from Fulcrum loans because of their indefinite term. Interest rates for fixed rate loans have a minimum interest rate corresponding to 80% utilization of the lending pool. When the lending pool’s utilization is between 80% and 90%, the fixed interest rate increases gradually. When the lending pool’s utilization goes above 90%, the interest rate scales drastically until utilization adjusts to a lower level.
It is also possible to take out staggered floating rate loans. These loans have interest rates which correspond to the borrowing rates on Fulcrum. The rates are fixed for 28 days, upon which they are automatically refinanced at the latest prevailing borrowing rate.
A step-by-step guide on how to access the platform can be found at https://help.bzx.network/en/articles/3469489-torque-a-step-by-step-guide.
What are the fees involved in using Fulcrum and Torque?
Trading fee of 0.15% on Fulcrum
Origination fee of 0.09% when a loan is opened
Interest fee of 10% of all interest paid
Half of the collected fees will go to BZRX stakers. The other half will go towards the Insurance Fund, which can also be claimed by BZRX holders.
How are positions liquidated?
Positions are liquidated using KyberSwap. When a trader/borrower goes under the maintenance margin, they are only partially liquidated, bringing their current margin back to 10% above the maintenance margin. By liquidating only as much as necessary, this reduces the risk of slippage from large liquidations.
ERC20s collateral will have an initial margin of 250% and a maintenance margin of 200%. ETH and stablecoins in the meantime will have an initial margin of 150% and a maintenance margin of 115%.
In the case that a lender loses their principal, the insurance fund will automatically disburse funds to the lender.
How to check the network health of bZx protocol?
Users may refer to bZx’s explorer page for more information.
What are the assets supported for Fulcrum and Torque?