6 min read
The First product from the Camelot Ecosystem: Nitro Cartel
The Nitro Cartel is an exciting DAO focused on the growth and development of the Arbitrum ecosystem. With its innovative products and governance mechanisms, the Nitro Cartel is poised to impact the DeFi space significantly.
Camelot is a DEX built on Arbitrum that aims to offer a tailored approach to liquidity provision through a feature-rich AMM, next-gen yield and incentives, permissionless access, and long-term sustainability. The protocol is highly efficient, customizable, and community-driven. It enables builders and users to leverage its infrastructure for deep, sustainable, and adaptable liquidity. With a dual token system consisting of the liquid GRAIL and the escrowed xGRAIL, Camelot strives to balance attractive incentives for initial liquidity growth with the long-term health of the protocol. The protocol is designed to provide the Arbitrum ecosystem with innovative features and functionalities, supporting new protocols launching on Arbitrum and enabling projects of all sizes to leverage its protocol in a way that suits their needs. Besides being a DEX, Camelot is a fair launchpad for its ecosystem. They just released their first project. Nitro Cartel.
Nitro Cartel is a decentralized autonomous organization (DAO) focused on the Arbitrum blockchain. This DAO is backed by a treasury that generates yield and contributes to the growth of the Arbitrum ecosystem. The Nitro Cartel is set to launch two products: Arbitrove and Hyperplane Bridge.
Arbitrove is a yield-bearing index that allows community members to have exposure to various assets within the Arbitrum ecosystem. These assets include blue-chip DeFi protocols, emerging protocols, NFTs, and yield-farming assets. With Arbitrove, community members can invest in a diversified portfolio of assets that generate yield on the Arbitrum blockchain. This is a great way for community members to earn a passive income without actively managing their investments.
Hyperplane Bridge is a community bridge that brings liquidity and total value locked (TVL) to the Arbitrum ecosystem. With Hyperplane Bridge, liquidity providers can bridge their assets from other blockchains to Arbitrum. This will increase the liquidity and TVL on Arbitrum, which will help to attract more users and projects to the ecosystem.
The primary objectives of the Nitro Cartel are to bootstrap TVL growth across the Arbitrum ecosystem and to allocate members' capital efficiently and transparently across Arbitrum-native yield-generating strategies. This means the Nitro Cartel will ensure enough liquidity and value in the ecosystem to support growth and development. The Cartel will also ensure that members' funds are allocated most efficiently and transparently.
The Nitro Cartel will leverage its novel governance mechanisms to efficiently spin up public goods that are forever composable with Arbitrum's leading DeFi protocols. This means that the Nitro Cartel will work to develop public goods that the entire ecosystem can use. These public goods will be interoperable with other leading DeFi protocols on Arbitrum, which will help increase the ecosystem's overall value.
In addition to these objectives, the Nitro Cartel will also get rewarded and proportionally distribute any token airdrop from partners. This means that the Nitro Cartel will receive token airdrops from partners and distribute them to its members fairly and proportionally. The Nitro Cartel may also receive an $ARBI token airdrop due to value-accretive contributions to the Arbitrum ecosystem.
Arbitrove is a pioneering platform that seeks a user-friendly means of acquiring exposure to Arbitrum protocols. Nitro Cartel's long-term vision involves creating a broad range of indexes encompassing various niches, including emerging protocols, yield-generating tokens, NFTs, GameFi,liquid staking derivatives, and more.
The first index that Nitro Cartel launched is called ALP. It comprises blue-chip Arbitrum assets like GMX and GNS, with yield-bearing strategies revolving around GRAIL, JONES, MAGIC, and other assets. ALP uses a mint/redeem mechanism, which allows users to mint the token with ETH, and there is a 0.5% fee for minting and redeeming. The protocol then procures the assets and executes yield-generating strategies, rebalancing as required.
The DAO aims to enhance overall Arbitrum liquidity by utilizing some assets in liquidity pools on decentralized exchanges. Nitro Cartel has also teamed up with Vesta, creating the possibility that ALP could be used as collateral for borrowing in the future. By continually broadening its range of indexes and exploring new collaborations, Nitro Cartel could play a pivotal role in shaping the future of decentralized finance on the Arbitrum network.
The Hyperplane Bridge is a feature with limited information available now. Therefore, this product may be postponed in favor of other products based on feedback from the community. From what is known, the goal of the Hyperplane Bridge is to deploy a bridge-type solution into Arbitrum, utilizing Layer Zero technology.
The main objective of this product is to provide users with a low-cost and easy-to-use bridge while also incentivizing them by offering native tokens to those who bridge to Arbitrum. In addition, there is a vision for the Hyperplane Bridge to work in synergy with other Nitro Cartel products, such as Arbitrove, by potentially allowing users to bridge and automatically purchase ALP.
The Hyperplane Bridge is intended to be community-owned and governed by the DAO, ensuring transparency and fair decision-making. However, Nitro Cartel is cautious with implementing this feature as bridges have high-security risks, and they want to make sure they are using the best possible technology to ensure the safety and security of their users.
TROVE is the governance token for the Arbitrove Protocol. The first index of the Arbitrove protocol is ALP, a basket of selected blue-chip tokens, including GMX, MAGIC and GRAIL. These tokens are deployed with various strategies to generate yield for users. Additionally, the protocol will add more indices in the future, such as ecosystem-specific indices like the GMX Ecosystem Index and strategy-specific indices like the Ethereum Liquid Staking Derivative (LSD) strategy index.
To ensure the long-term success of the protocol, 70% of the total TROVE supply that would ever exist will initially be in the form of Escrowed TROVE (esTROVE). This non-transferable token can be staked for protocol revenue sharing if the DAO approves the TROVE staking proposal, which is expected to be submitted in early March. It can also be vested to become TROVE through a 1-year linear vesting process starting in September 2023. However, esTROVE being vested is not eligible for staking or fee sharing.
The tokenomics of TROVE is inspired by the successful es-model of GMX, which allows supporters to benefit from real yields through protocol fees while ensuring the long-term success of the protocol. The team's token allocation will also be in the form of esTROVE, aligning their incentives with those of the users and passport holders.
By utilizing TROVE, users can participate in the governance of the Arbitrove Protocol and have a say in important decisions that affect the protocol's future. This aligns with the DAO's vision of creating a community-owned and governed ecosystem. TROVE also incentivizes users to hold and use the token, creating demand and liquidity in the market.
Nitro Cartel seems to be an ambitious and forward-thinking player in the DeFi space. Their first major product, Arbitrove, aims to provide users with a convenient way to gain exposure to Arbitrum protocols. The long-term plan is to have various indexes that cover emerging protocols, NFTs, GameFi, and other subcategories. The ALP index, the first index released by Arbitrove, includes blue-chip Arbitrum assets and employs yield-bearing strategies to generate user returns. The fact that Nitro Cartel is partnering with Vesta to potentially enable ALP to be used as collateral for borrowing further underscores their commitment to creating value for users.
Furthermore, Nitro Cartel's tokenomics model for the governance token, TROVE, is inspired by GMX's successful es-model, which has been shown to ensure the long-term success of a protocol while allowing supporters to benefit from real yields through protocol fees. By creating esTROVE, a non-transferable token that can be staked for protocol revenue sharing, Nitro Cartel is aligning the team's incentives with those of its users and passport holders. This further reinforces their commitment to creating a community-owned and governed ecosystem.
Overall, Nitro Cartel's ambitious roadmap and strategic partnerships indicate they are serious about significantly impacting the DeFi space. In addition, the fact that they are focused on building user-friendly and low-cost products with a strong emphasis on security is an encouraging sign. While it is still early for Nitro Cartel, their products' potential and commitment to creating a community-driven ecosystem make them a player to watch in the DeFi space.
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