Moonbeam’s First Polygon (MATIC) Initial Liquidity Offering (ILO)

5 min readFeb 1, 2022

$MATIC is finally coming to Moonbeam! We’re proud to be the first DEX to support the Polygon blockchain, allowing users to bridge their $MATIC into the recently launched Moonbeam network.

To celebrate the listing of MATIC/GLMR and MATIC/STELLA, we are organizing the first Initial liquidity offering (ILO) on 03 February 2022 at 16:00 PM UTC. You will get a chance to buy 20% off STELLA with your committed MATIC within the 24 hours window. After the ILO ends, the pairs will be listed and you can be one of the early few to maximize the APR returns!

What is ILO?

Initial Liquidity Offering (ILO) is a novel mechanism to facilitate liquidity towards the newly-launched Moonbeam network. Being the first to launch on Moonbeam, StellaSwap is one of the leading DEXs with the main aim of attracting liquidity towards Moonbeam. With an ILO, liquidity and capital from other blockchain networks — such as Fantom, Polygon and more — can easily be accumulated in Moonbeam network, facilitating more efficient market pricing that will ultimately mean better prices of tokens for end users.

StellaSwap’s ILO will allow users to bridge MATIC from Polygon blockchain and commit those MATIC into buying $STELLA at a 20% discount. After the ILO ends, StellaSwap will launch 2 MATIC pools for users to earn massive APR returns: MATIC-GLMR pool and MATIC-STELLA pool.

MATIC ILO Details

STELLA Allocated for ILO: 40,000 STELLA
ILO Duration: 24 hours
StellaSwap’s MATIC Bridge Launch: 02 February, 16:00 PM UTC
ILO Date & Time: 03 February, 16:00 PM UTC
ILO End Date & Time: 04 February, 16:00PM UTC
Launch of MATIC-GLMR & MATIC-STELLA Pool: 04 February, 17:00PM UTC

StellaSwap’s ILO Mechanism

For the ILO, StellaSwap will utilize the Overflow model, which facilitates a pro rata capital distribution method and refund mechanism in the event of oversubscription. This simply means that the more MATIC you commit to the ILO, the more STELLA you stand to receive, and you’ll be refunded for the remaining MATIC that wasn’t converted to STELLA. Participants are free to commit as much MATIC as they want, and their STELLA allocation will be proportional to their committed MATIC in relation to the overall total MATIC committed by all participants. Whatever MATIC remains that wasn’t converted will be fully refunded.

Let’s look at 3 scenarios for greater clarity, with a hypothetical simple assumption that 1 STELLA = 3.5 MATIC and there’s 40,000 STELLA allocated to the ILO.

Scenario 1: 100% Filled Allocation

In this scenario, the entire allocation of 40,000 STELLA is taken up by users who cumulatively invest 140,000 MATIC. If you invested 14,000 MATIC, you will get 10% of the STELLA allocation at the price of 1 STELLA = 3.5 MATIC, which amounts to 4,000 STELLA tokens. You will not get a refund since all of your 14,000 MATIC will be converted to 4,000 STELLA.

Scenario 2: Oversubscription or Overflow (Hence, the name Overflow)

Oversubscription or overflow means that there is an excess of MATIC chasing a fixed amount of 40,000 STELLA. If there is a total of 280,000 MATIC committed by all users in the ILO and you invested 14,000 MATIC , you will get 5% of the STELLA allocation, which means 2,000 STELLA tokens. You will be refunded 7,000 MATIC since it is unused.

Scenario 3: Undersubscription

This means that the total MATIC committed isn’t sufficient to fill the established STELLA allocation. If there is a total of 70,000 MATIC committed by all participants and you invested 14,000 MATIC, you will get 4,000 STELLA in accordance to the price of 1 STELLA = 3.5 MATIC. You will not get a refund since all of your 14,000 MATIC will be converted to 4,000 STELLA.

How Do I Participate in the ILO?

It’s really simple! Ensure that you have MATIC on Polygon blockchain and you can start getting ready for the ILO! 24 hours before the ILO starts, StellaSwap will launch the MATIC bridge so users can start bridging their MATIC in preparation of the ILO. Once the ILO begins, they can start committing MATIC on the ILO page for the next 24 hours!

What is The Raised Funds Used For?

$100k worth of MATIC raised will be used for Buyback across a one-week period. This ensures that we can contribute towards maximizing tokenholder value.

The rest of the funds raised for MATIC will be accrued to the Treasury. Since StellaSwap was launched under a Fair Launch model, there is no presale, private sale or investor allocation, ensuring that emissions are geared wholly around incentivizing the community. In order to maximize tokenholder value for the long-run, StellaSwap must accrue funds to the Treasury to grow the ecosystem and effectively manage market conditions, which include engaging in buy-backs to reduce token supply, establishing incentivization programs (e.g. Airdrops) that does not contribute to excess inflation, as well as reinvesting back into the ecosystem.

Will Tokens “Dump” Due to STELLA’s ILO Discount?

One of the design decisions that we’re bent on solving is enhancing native STELLA liquidity. A simple way to do it is to increase the emission rate of native-STELLA LP farms. However, that represents a superficial way that is focused on a short-term fix since increasing emissions leads to stronger selling pressure and value dilution. What we focused on was calibrating variables to attract ‘new money’, rather than existing funds in Moonbeam. Therefore, we settled on incentivizing new money via an ILO which facilitates direct investments into STELLA token itself, and thereafter maintaining the incentive of staking through high initial APR (due to low TVL at first). This dual approach would create a higher ‘stickiness’ within our system, therefore boosting tokenholder value.

About StellaSwap

StellaSwap is the first and leading Moonbeam DEX that offers an integrated gateway to the DeFi world. Users can swap, earn, yield farm, bridge assets, explore new projects and engage in NFT trading all from a single unified platform. StellaSwap’s products are structured in such a way that facilitates decentralized governance of STELLA holders, while continuing to innovate on the collective foundations by design.