Today, Bitfinex transfers 80% of their Nectar (NEC) holdings to a 4-year vesting contract while donating 9.4M NEC tokens for community & bounty initiatives. This move symbolises Bitfinex’s ongoing, long-term support for the DeversiFi | Nectar ecosystem. Read on now to learn the what, the why and the when.
Context is important. What is and where do these NEC tokens come from? In short, the DeversiFi | Nectar ecosystem is the culmination of years of development. Life began back in 2017 as Ethfinex — a company incubated by Bitfinex with a mission to put decentralised trading, and governance technology to the test.
It goes without saying that Bitfinex were early supporters, and early adopters of the Nectar token, back when the Nectar 1.0 Whitepaper was released. Pioneering liquidity mining, Nectar was distributed to market-makers of Ethfinex in proportion to their trading volume. These tokens could be redeemed for ETH, used in governance, or traded on the open market, among other utilities.
In 2019, Ethfinex closed down, and a new, independent entity called DeversiFi was born. During this transition, two notable things occurred:
- Nectar 2.0 emerged, with a revamped set of utilities designed to serve the DeversiFi and NEC ecosystem &,
- Ethfinex burned 400,000,000 NEC tokens symbolising its closure as well as NEC’s shift to deflationary tokenomics.
This big burn event meant Bitfinex’s proportional NEC holdings increased to a larger percentage-amount than before. Bitfinex remains supporters of the Nectar community and as a result, have donated 9.4M NEC for community initiatives (to be managed and led by DeversiFi) while sending 80% of holdings to a public, 4-year, second-by-second linear vesting contract.
*The remaining 20%, may, moving forward, support various other programmes in unison the DeversiFi team, with the goal of supporting the Nectar ecosystem.
Directly from the original Bitfinex announcement:
As one of NEC’s major token holders, Bitfinex is aware of the impact that we may have on the future of DeversiFi as a decentralised exchange as well as the long-term health of the token. We remain a supporter of the project and community; thus, we plan to seek opportunities to reduce our holdings over time.
For a start, Bitfinex will provide 9.4 million NEC to a community incentive program to be created and managed by the team at DeversiFi. The details of this community incentive program are expected to be announced by the DeversiFi team in the near future. Bitfinex has also transferred ownership of most of its NEC to a publicly visible, linear vesting contract as seen here. These tokens will unlock in ~4 years due in March 2024.
Moving forward, we intend to work on various other programmes with the DeversiFi team to distribute further NEC tokens. We aim to encourage growth in the number of token holders and the token’s value accrual, which ultimately will reduce our percentage holding.
Bitfinex has been and will always be a believer in the decentralisation concept and system. Therefore, we intend to follow whatever decisions the Nectar holders decide through the Nectar DAO (Decentralised Autonomous Organisation). — Bitfinex
For any questions, head over to the growing DeversiFi | Nectar discord community.