Mechanics: ( simplified )
Token: Pi, pBNB, sCircle, bCircle
PI is the native token of the PI Ecosystem, the basic unit of all that follows.
pBNB is a synthetic BNB token, minted at a 1:1 ratio to BNB.
This token is needed to convert BNB into PI.
It’s a “middleman” in the conversion process.
The small Circle is an ERC 1155 NFT, a “wrapper token” for the PI/pBNB LP.
It is minted at a 1:1 ratio to the LP. It is representative of each Liquidity Pair of pBNB/PI.
sCircle is the “basic utility token” of the PI ecosystem.
Big Circle is also an ERC 1155 NFT, the “full utility token” for the PI ecosystem. One bCircle token is equal to 5 sCircle tokens.
The bitCircle NFT is the most basic way of utilizing the PI ecosystem. It does not involve any type of wrapper token.
Normally, you can buy a project’s native token on a DEX, by simply converting BNB (for example) into that token. Therefore, other projects add a “BNB/native token” Liquidity Pair to a decentralized exchange (DEX).
Instead of having a BNB/PI Liquidity Pair on Pancakeswap, we will add liquidity for another pair: pBNB/PI.
The pBNB synthetic token effectively replaces the BNB token.
This means that PI Token only can ultimately only be bought with pBNB.
Why is that needed?
To have the possibility for a floor sweeper mechanic (see below), we need this “middleman” — the Liquidity is for pBNB and PI — so the BNB can be swept out and reused. Without this “middleman” it wouldn’t work.
To make it user friendly:
To make the process easier, we have developed our trading tool,
the “PI swapper”.
The PI swapper works like a DEX ( Pancakeswap, Sushiswap, etc.)
The swapper can be found here:
As you can see on the screenshot, you can now buy PI Token directly with BNB.
How does that work?
Our contracts do all the work. If a user is buying PI with BNB on the swapper, the contract is doing the following in the background:
First, the BNB is converted into pBNB via the contract.
Next, the pBNB is used to buy the PI token on the DEX where we provided Liquidity.
What the users see: BNB -> PI
What the contract does: BNB -> pBNB -> PI
Is there another way to buy PI?
If users prefer to trade on a DEX, they need to convert BNB to pBNB on our website and afterward, they can buy PI Token with pBNB on the DEX directly.
What about selling PI? How does that work?
We have the same two options when selling PI back to BNB, only in reverse.
Users can use our website UI to convert PI to BNB directly. Or they can convert PI to pBNB on the DEX, and afterward convert that pBNB to BNB on our website.
The ratio for BNB <-> pBNB is always 1:1 and will never change.
The LP of pBNB/PI:
As usual, we will add liquidity to Pancakeswap, which involves pBNB and PI Token. Users can also provide liquidity this way on the DEX if they want.
Liquidity is not locked by doing so.
So if users just want to participate in the Ecosystem by trading the native token of PI, they can do it by buying PI with BNB or pBNB on the DEX, or via our swapper.
More about the Circles: sCircle, bCircle
sCircle is the representative token for the LP pair of pBNB/PI Token.
It is the basic utility token for the PI ecosystem.
Normally, if a user owns an LP of a project, the LP is just sitting in the wallet. There is no use case and no utility.
To add a use case, we decided to make an “LP Wrapper Token”, the sCircle NFT.
This creates a representative of the LP which has its own name relative to the project and can be used in the Ecosystem as a discrete unit.
If a user owns a pBNB/PI LP, he can convert it into a sCircle NFT by using our swapper.
The ratio is always 1:1, which means a user will get 1 NFT for 1 LP.
By swapping an LP to an NFT, the NFT gets minted and the LP gets locked. But, in the case of sCircle, we’re offering an exit strategy.
While normally you can never sell a locked LP, we made it possible to do so.
If a user decides to sell his NFT, he can sell it back to the Ecosystem and will get 50% of its value.
The sCircle NFT gets “burned”, removed from the ecosystem forever.
sCircle holders can also sell their NFTs directly on Opensea, or the PI NFT marketplace.
To participate in the PI Treasure Hunt, users need to hold at least 1 sCircle to gain access to the gaming area!
This is one of the benefits of owning the sCircle NFT.
Are there other ways of getting a sCircle NFT?
We’ve already discussed how the pBNB/PI LP can be used to obtain the sCircle NFT. BNB, pBNB, and the native PI token can alternatively be used.
So, what happens in the background?
1. BNB -> sCircle:
BNB -> pBNB minted at 1:1 ratio-> half of the value of this pBNB is converted to PI -> creating an LP ->minting a sCircle and locking the LP.
2. pBNB -> sCircle:
pBNB -> half of the value of the pBNB is converted to PI -> creating an LP -> minting a sCircle and locking the LP.
3. PI -> sCircle:
BNB half of the value of the PI is converted to pBNB -> creating an LP -> minting a sCircle and locking LP.
The bCircle NFT is the 2nd 1155 NFT in the PI ecosystem and is the full utility token.
To get a bCircle, users can convert 5 sCircle to 1 bCircle.
This means 1 bCircle equals 5 Liquidity Pairs of pBNB/PI, indirectly.
The bCircle NFT is minted and cannot be sold back to the Ecosystem like the sCircle, but they can be traded on NFT marketplaces and on our Swapper.
PI will provide an “Infinite Staking Pool” for bCircle holders.
2% of all transactions go directly into this pool as a reward for participants.
Therefore, bCircle holders will benefit in the long term by staking them.
In addition, the PI NFT “Aggregator Vaults” can be used only with the bCircle NFT.
bitCircle: Optional Utility
If a user does not want to participate directly in the Ecosystem by using the Token Wrapper, we will offer a bitCircle NFT.
By holding a bitCircle NFT, users will be able to stake into the bitPool.
bitCircle will be available on the Marketplace and can be traded.
The Price Floor and Sweeping
The LP Token (wrapped Token, sCircle) will be locked via the LP wrapper to create a price floor mechanic.
The liquidity pool pair (pBNB/PI) can be “swept out” and utilized for the growth and benefit of the community.
If every PI token that is not in the liquidity pool is sold into the pool, the resulting price will be the floor.
Our router has a function to check this price and can use the BNB below the floor in both farming and other price-increasing strategies.
And even more…
PI token holders can vote to include other projects in the ecosystem! NFTs from the resulting partner projects can then gain utility they never had before.
PI Protocol is an expansion of the utility of the entire NFT market!