This is a review of the Polycat (FISH) cryptocurrency. It will be updated every 2 months to reflect any changes in this cryptocurrency’s performance.
Polycat is a new cryptocurrency that aims to have no fees on transactions. The project has been around for about two years and has seen some success, but it’s still too early to tell if the near-zero fee structure will be worthwhile.
What’s the weirdest name for a DeFi project you’ve come across? PancakeSwap and Uniswap came to mind immediately. BakerySwap, planet.finance, Ellipsis Finance, and Curve are all good options. Because they’re all on the Ethereum and Binance Smart Chains, we’ve all heard of them. However, there is a new ecosystem that is using Ethereum’s security to act as a “way around” chain, allowing users to avoid paying exorbitant gas costs.
That would be Matic, which has just been renamed as Polygon, and there is a new initiative that has sprung out of nowhere and grabbed the attention of many eager investors. And when I say new, I mean brand new. It had barely been up for a little over two months when I wrote this piece.
So, what exactly is this new DeFi initiative? Polycat is the name of the cat. Yes, I understand that the teams behind these initiatives have given up on coming up with creative titles. Nonetheless, this initiative has some significant claws that can gnaw and scrape away at its rivals. This Polycat review will look at the software and what it has to offer. We’ll go through its features and services, as well as the tokenomics of its tokens, to see whether you should get some of that catnip.
What Is Polycat Finance, and How Does It Work?
Polycat is a decentralized hybrid yield optimizer (yield farm and yield aggregator) that runs on the Polygon blockchain. It is value-oriented, economically sustainable, and decentralized. That was a mouthful, but in layman’s words, it’s a procedure for finding the greatest agricultural output in other projects. Instead of needing to explore an entire blockchain ecosystem for the projects that provide the greatest profits, Polycat will do it for you, like yearn.finance. It was released on May 2, 2021, and the total amount locked has steadily increased.
According to their Medium introduction essay, they chose Polygon to start the project due of their near-zero transaction costs and because they were disillusioned by the amount of frauds and fraud on the Binance Smart Chain. They used their testnet to create the project, but it was eventually released on Polygon.
Despite the fact that the project is just a few months old, it already offers services and features that allow users to earn high-yield incentives.
Polycat’s vaults are auto-compounded, which means that users that deposit LP tokens or a single token will have their reward immediately added to their deposited tokens, speeding up the reward rate. Users do not have to manually collect and redeposit their incentives. This is for single token vaults or pools.
The vaults now have no deposit fees, however there is a 0.1 percent withdrawal charge for any non-FISH tokens (FISH is the vault’s native token). (See below for further information.)
Furthermore, 5% of profits from normal vaults are used to burn FISH, while 100% of earnings from burning vaults are utilized to burn FISH. Liquidity provider costs for LPs are included in the APY for vaults.
Trading costs and pool rewards combine to provide these APYs. Liquidity providers are paid trading fees based on their percentage ownership in the LP. Trading commissions vary, but they are usually calculated as a percentage of all transactions on the pair. Trading commissions are immediately added to the pool and accumulate in real time. By removing your liquidity from the pool, you may claim the trading fees.
We include your accumulated trading costs into the APY calculations for convenience. Every five minutes, the pool prizes are automatically compounded. They are immediately compounded into your investment after being sold to buy additional LP tokens on your behalf. As a result, pool prizes gradually increase the number of LP tokens you possess.
Compounding ensures that the prizes in the vaults are compounded once per minute, due to Polygon’s near-zero transaction costs. One of the team’s objectives is to allow auto-compounding on farms that do not currently support it. They do this by improving the performance of other yield aggregators.
Then there are vaults that are on fire. They have their own set of advantages since they are utilized to control the burn rate of fees.
Here’s an illustration. Assume the protocol has $10,000 in fees it wants to spend. Most other yield farms would just take a part of the funds ($1,000, for example) and send it to a burn address.
This results in a $9,000 fee surplus and a temporary increase in the token price. There will eventually be no more fees to burn. Because there is no longer a financial incentive to farm, the token’s price will eventually drop to zero.
Polycat differs from the competition in that it stakes part of the burning fees in a vault, such as AAVE-USDT. The profits from the vault are then burned.
In the $10,000 example, $3,000 is put aside for direct burning, while the remaining $7,000 is staked in a vault, yielding a modest but steady $30 each day. The key is consistency: it will earn $30 each day on a daily basis.
The fee vault expands as deposits rise, resulting in additional prizes to burn. The aim is that this will prevent the price from progressively dropping to zero, making Polycat farming more long-term viable.
While staking LP tokens, you may acquire FISH, Polycat’s native cryptocurrency, through farming. Polycat’s optimized yield methods guarantee that customers receive the most competitive prices possible.
The protocol now supports the following LP tokens:
- WMATIC FISH (QuickSwap)
- WMATIC FISH (SushiSwap)
Polycat’s pools are straightforward to utilize. Users don’t have to worry about temporary losses or having to sell half of their winnings to boost additional liquidity since they’re single token pools. This is a fantastic method to make a lot of money. Please keep in mind that pools do not automatically compound.
Users must pay a deposit fee of 4% in certain pools. These fees will subsequently be used to:
- The burning vault receives 50% of the funds.
- The direct burning charge is set at 25%.
- 25% is allocated to marketing and development.
WMATIC, WETH, WBTC, SUSHI, QUICK, DFYN, USDT, USDC, DAI, IRON, POLYDOGE, LINK, AGA, AGAr, TITAN, and KRILL are among the pools now accessible.
Polycat’s partner projects benefit from the thank function, which serves as an incubator. Users just stake their FISH tokens in one of the pools and are rewarded with tokens from that project.
Polycat has a referral system in place. Farms and Pools reward users who successfully introduce a friend into the ecosystem with 1% of their friends’ fees. It should be mentioned that referral payments are not deducted from the fees of their friends.
Users interested in seeing their connection may go to the polycat.finance referral area here. Please note that in order for the site to show its unique connections, users must connect their wallets.
Farm’s First Offering (IFO)
The team stated that they will be releasing an IFO in a Medium post on June 3, 2021.
To summarize, an IFO is used to promote a new business and raise money from prospective investors. Polycat burns a part of the FISH invested in this project, and users are rewarded with fresh tokens.
A new project’s token will be sold mostly in USDC, with a minor amount of FISH burnt as well. The crew did not want to burn too much FAST since the maximum supply of FISH is just 3 million. Furthermore, rather of handing over all FISH staked to the new project, which may result in huge price fluctuations if the project chooses to sell them for cash, the project was given USDC instead, with just a tiny part of FISH burnt.
FISH is the project’s native token, as previously mentioned. It has a maximum supply of 3,000,000 copies. It emits 0.80 FISH/block at a rate of 0.80 FISH/block. At this pace, all FISH tokens are expected to be produced by August 2021.
The developer’s address will get 10% of the emission incentives (0.08 FISH). These money will be utilized for future collaborations and growth, according to their documents.
Aside from that, that’s all there is to know about the token. This is a little strange, but it’s unclear if FISH is a governance token, or whether FISH holders would get a part of the project’s profits, or both.
Despite the fact that Polycat is just a few months old, it has already through three audits. TechRate was in charge of the first, which was finished in May 2021. There were no severe or medium-severity problems discovered in the report.
Obelisk also conducted two additional audits (I & II). Certain problems were discovered, which the team promptly resolved.
CertiK, a well-known company, is now conducting its fourth audit.
Although this is a good indicator that the team is concerned about security, it should be noted that auditing is no assurance that the project will not be hacked or exploited.
However, the team has introduced timelock and removed the contentious migrator code, which may be easily exploited by developers or hackers to steal users’ money. Polycat smart contracts are protected by timelocks, which prohibit any unnoticed and quick modifications.
Changes are locked for a period of time and may be publicly watched, alerting users to any changes. Malicious parties may alter smart contracts without notice if there are no timelocks in place. As a result, the crew was given a three-hour time limit, which was later extended to six hours. They want to extend it to 24 hours in the future.
Features Not Included
The team is also creating leveraged yield farming and its own Automated Market Maker as part of their plan (AMM).
They’re also developing a VaultZap tool, which is similar to yearn.finance’s Zap feature for quick and inexpensive transactions. The protocol is also working on an NFT home, which is unsurprising.
Polycat is a new project, and as a result, it has an uphill fight in persuading people to adopt its protocol. The Polygon ecosystem has witnessed a surge in new Dapps and Ethereum-based Dapps joining to the platform.
Reef Finance, Autofarm, and Bonded Finance are just a few of the Dapps that will give Polycat a run for its money. On the Ethereum blockchain, Yearn.finance is likewise an aggregator that is still extremely active and popular.
This isn’t even taking into account the slew of other Dapps vying for users’ attention, restricting Polycat’s ability to grow.
Its sole genuine selling point so yet has been its high dividends, but after all FISH tokens have been issued, this will eventually lose value.
Links to tutorials and how-to videos
Here’s how you can acquire FISH tokens by staking your LP Tokens:
The following is a link to learn how to transfer your crypto holdings to Polygon:
In addition, the following videos go through the procedure in more detail and provide a step-by-step guide on how to utilize it:
Conclusion of the Review of Polycat
Polycat has a strong tokenomics and provides consumers with large returns for near-zero costs. It intends to collaborate with other emerging initiatives in order to get greater visibility and usefulness.
However, this is still a relatively young initiative, and there are no assurances that it will succeed. Furthermore, other than as a basic reward token, there is no indication of what the function of its token is. Although it is fair to presume that it is also a governance token, the team will typically mention it on the documentation, and we won’t know for sure until they do.
Furthermore, Polycat faces competition from other well-established Dapps like Reef Finance and yearn.finance, so it will be up to the team and its fledgling community to innovate and guarantee the protocol’s long-term viability. In the meanwhile, it’s fair to assume that consumers will be able to earn such large returns in the near future.
- Long-Term Prospects
- For pools and vaults, it provides a high yield.
- Tokenomics is good since it is deflationary.
- Have near-zero transaction costs on top of Polygon.
- Uncertain about the native token’s function
- A brand-new initiative with a high level of risk