What is a Liquidity Bootstrapping Pool? (LBP)
Liquidity Bootstrapping Pools (LBPs) are a specific configuration of Balancer’s Liquidity Bootstrapping Pools. Their primary use cases are to:
  1. 1.
    Distribute ERC-20 tokens
  2. 2.
    Drop collections of ERC-721 NFTs represented by ERC-20 tokens

Key Features

  • Price discovery. The price of the token starts high and drops based on a pre-configured price decay curve that can be resisted by buying pressure from LBP participants. Anyone can buy into or sell out of the LBP freely at any time, so price truly regulates itself.
  • Open and permissionless participation. No whitelists, hard caps, or listing requirements. There is no minimum or maximum allocation. LBP participants choose how much they want to buy.
  • Fair distribution. LBPs flip the first-come-first-serve launch model on its head. It's no longer a race where the first bot in or the transaction with the highest gas fee wins. Get your token into the hands of as many people as possible in a fair way that disincentivizes front-runners and whales getting better rates than smaller participants.
  • Capital efficiency. The initial price of the project's token in the LBP can be magnified by up to 99 times relative to the collateral deposited along with it. Additionally, the collateral can be fully retrieved at the end of the LBP unless the project's tokens already exists outside of the LBP, in which case someone could decide to sell into the LBP.

States of a LBP

A. Scheduled, but not yet started

B. Early live LBP with moderate activity

Figure B. Enough buying activity to shift the price decay curve up but not override it

C. Completed LBP with early spike in activity followed by steady action.

D. Completed LBP with significant buying activity

The aKlima LBP was set to start at around $100 and drop down in price to around $10. As you can see in Figure C the significant pressure on token supply counteracted these price decay settings.
Please note that participating in a LBP through Copper is a high-risk endeavor and that the value of the tokens that you've received in exchange for contributing to such a LBP might go to 0. Copper is not liable for any losses incurred by using our platform.
Copper was built as a convenience tool to more easily view and track Ethereum network events emitted through Balancer Protocol's smart contracts, and in particular to more easily surface a particular subset of Balancer's Liquidity Bootstrapping Pools (LBPs). Because Ethereum is a permissionless network and Copper is merely a view into the network, Copper bears no responsibility for the quality of projects that are surfaced as LBPs through the Copper UI.