Rumpel - Making Illiquid Points Tradable: What You Need to Know
Points Tokenization, Points Protocol Landscape, & More
The $KAITO TGE is scheduled for tomorrow; of all airdrops so far, Kaito yaps have likely been one of the fairer distribution mechanisms. This airdrop will also not be the end of yaps distribution with multiple more rounds scheduled to take place. This underlines the fact that the points meta is far from over, and when done right, can be a meaningful way for protocols to grow their community before TGE.
Just as loyalty point systems have proven to be a highly valuable asset for traditional businesses, points systems have become a central feature for the early onboarding of users. Not only are they a replacement for liquidity mining programs in the pre-TGE days, but they have also proven to be very helpful for protocols to guide their users and incentivize behavior. This allows projects to reward users who contribute liquidity or volume by performing the most valuable actions for the protocol at any given point of time.
We’ve seen tokenomics models improve over time in crypto, and the points meta has been important in aligning incentives between the protocol and users. However, there is still the primary limitation in that these points are illiquid and untradeable. Rumpel addresses these challenges through a points tokenization protocol that brings liquidity and price discovery to off-chain loyalty points. In today’s edition, we’ll discuss Rumpel’s protocol design, use cases, and more…
Stay informed in the markets ⬇
Background on Rumpel
Rumpel is a point tokenization protocol that enables secondary market liquidity and price discovery for off-chain loyalty points, unlocking new opportunities for point holders, traders, airdrop hunters, and point issuers. Rumpel adds functionality to these points before they are converted to actual tokens. This allows various stakeholders, such as traders, LPs, and point issuers, to engage in new strategies by leveraging points.
Rumpel allows users to transform their earned loyalty points into Rumpel Point Tokens (pToken) using a personal Rumpel Wallet, a specialized Safe Multisignature wallet. The Rumpel Point Token (pToken) is a digital asset representing an off-chain loyalty point and its future rewards. These tokens are directly tied to the points accumulated in a user’s wallet.
As users accumulate points, the Rumpel Oracle system verifies the off-chain point balances and adjusts the users’ allowances for minting new pTokens accordingly. When a project announces an airdrop, holders of pTokens can redeem them for their proportionate share of the airdrop, including any future vesting allocations, through Redemption Rights via the Rumpel Vault.
Other players involved in the points space include Whales Market, Bubbly, Pendle, and more. Some markets have collateral requirements, potentially limiting flexibility and accessibility for users needing immediate liquidity. This can mean having liquidity locked up in a sale for an unspecified amount of time if the points issuing protocol delays its TGE. Protocols like Pendle and Spectra also specialize more in the leveraged points-earning game, not necessarily the buying and selling of points.
Rumpel sets itself apart by offering a comprehensive point tokenization protocol that enables deep secondary market liquidity and price discovery for off-chain loyalty points without requiring user collateral. Through the Rumpel Wallet, users can wrap their earned points into pTokens and sell them anytime, providing immediate liquidity and reducing exposure to specific point programs.
Since its launch in September last year, Rumpel has achieved a TVL of over $34M, even after the most recent market downturn. There are markets for tradable points from Ethena, Symbiotic, Zircuit, Karak, Resolv, and EtherFi.
Rumpel has a rewards program of its own, Rumpel Straw. Rumpel Straw serves as both an incentive mechanism and a community-building tool, encouraging early adoption and sustained usage. articipants earn Straw points through activities such as tokenizing points via Rumpel, providing liquidity in designated Uniswap V3 pools, and engaging with Rumpel’s social initiatives.
Important Links
Become a Premium member to unlock all our research & reports including access to our members-only discord server.
Join thousands of sharp crypto investors & traders by becoming a Premium Member & gain an edge in the markets. For just $129/month, you can access our full suite of offerings:
Gain instant access to Deep Dives, Blueprints, and Perspectives.
Priority access to new features and exclusive content.
Ideal for investors who demand comprehensive insights.
Full access to historical research archive and analytics tools.