Overview

Blackpaper v1.0

Bumper is a distributed software application which establishes markets for measuring and exchanging blockchain-based asset price risk. The protocol exposes a set of autonomous functions that allows users to take positions which protect the value of deposited cryptocurrencies (such as Ether (ETH), wrapped Bitcoin (wBTC), and others) and locks these deposits for a fixed period. The deposits are pooled and collectively incur a regular, dynamic premium. Those who take a Hedge position in the protocol are known as “Takers”.

As these premiums accumulate, they are used to incentivise deposits of a price-stable (such as USDT) token into a corresponding pool which serves to back the protected value of the price-volatile token on the other side. The protocol makes the stablecoin available to individual Takers in the event of a claim. A protection position can claim the protected value from the stablecoin pool when the measured value of the backed cryptocurrency is below the individual floor price at the time of expiration. The originally protected asset is left within the protocol.

Those who make the stablecoin available in the protocol seek to develop a yield from the negative price volatility of the backed cryptocurrency. They are known as “Makers”.

Bumper is completely distributed, autonomous and permissionless. Participants must lock a native protocol token (BUMP) into the system to access its market functions and for decentralised community governance.

This document outlines the Bumper Protocol’s token utility and distribution characteristics.

Further information about the Bumper Protocol can be found at bumper.fi.