$CLP

$CLP

$CLP is the liquidity provider token for CRUST Exchange platform. It’s based on $USDT staking, and can be redeemed for $USDT at any time. Anybody can stake $USDT to mint $CLP and earn fees based on generated trading volume on the platform.

$CLP Contract Address:

Minting/Redeeming

In order to Mint $CLP you need to:

1. Bridge $USDT from any ecosystem to Core Network.

2. Stake $USDT (ensure that some $CORE is available in your wallet to pay for the network transaction fees) by entering the amount of $CLP you’d like to mint.

There were no fees for minting $CLP during the Hyper $CLP period. Currently for $CLP there is a 0.15% fee for minting and redeeming. Redeeming CLP is just as simple by entering the amount of $CLP and selecting the stablecoin you'd like to redeem for (with USDT being the only available option at time of launch).

Cooldown: Every time a $new CLP is minted, it will start a 2-day cooldown period for your $CLP balance. After this period, $CLP balance can be redeemed for $USDT at any time until any new $CLP is minted.In addition to the staking function for minting $CLP, users also have the ability to whitelist wallets or contracts that can stake on their behalf. In the future this will be used to allow cross-chain staking functionality.

Why $CLP?

$CLP is to provide liquidity for traders, allowing them to take positions with leverage. If traders take a loss then the $CLP holders will make profit, if the traders take a profit then $CLP holders will make a loss. Although $CLP value is market neutral and is not directly affected by the crypto market volatility, holding $CLP still bears risks. For taking these risks, $CLP stakers can earn up to 60% of the platform fees generated via trading activity.

Smart Contract risk: Crust Exchange smart contracts will be fully audited but nonetheless some inherent risks will always exist with any smart contracts.

Counter-party risk: If traders make profit, that profit is paid to the trader out of the $CLP pool.

Depegging risk: In the unlikely scenario that $USDT depegs, $CLP is directly affected.The open interest available for the perpetual platform is limited by the total $USDT available in $CLP. Traders cannot open a new position if the total platform open interest meets or exceeds the total TVL in $CLP.

$CLP Liquidity Pool

A portion of all protocol generated [$G$] fees including opening/closing positions, minting CLP, and excess funding fees as well as any losses [$L$] from traders realized P&L and liquidations go towards the CLP vault causing it's price to go up over time. Any profits [$P$] from traders realized P&L are paid out from the CLP vault causing its price to decrease. Overall, it is expected and highly probable that the price of CLP will gradually increase over time as net inflow exceeds net outflow.

The $CLP price is based on the number of USD and CLP in the vault, at any time, where:

$$CLP_{price}=\frac{USD_{vault}}{CLP}$$

​​The amount of CLP minted [$M$] or redeemed [$R$] does not affect the price of CLP, however it does affect the rate at which CLP price changes which can be expressed as follows

$$\Delta{CLP_{price}}=\dfrac{\Delta{G}+\Delta{L}-\Delta{P}+CLP_{price}\times(\Delta{M}-\Delta{R})}{\Delta{M}-\Delta{R}}$$

​For example let's say you mint 500 CLP at a price of $1.00 by depositing 500 USDT into the CLP Liquidity Pool. Over time, due to the net flow of USDT into the pool, let's say the price of CLP has gone up to $1.50. If redeeming your 500 CLP (now worth 750 USDT), you would have made a 50% return on your initial investment.

Vault Contract Address:

Staking Rewards

By staking their $CLP, users receive a share of 10% of the total perpetual fees in $zCRUST for each corresponding rewards cycle.​ Reward Cycle 0 will pay out a fixed amount of $zCRUST rewards for CLP stakers.