Salaam Mufti Saab,
I was wondering if whether you could shed some light on whether these 2 cryptos are halaal or not?
The first is Badger Dao and here is some information regarding it:
BADGER is the governance token for the Badger DAO. It can be used to vote and receive cash flow from the fees earned by the protocol.
BADGER tokens were airdropped on 3rd December 2020 to users that:
- Supported public goods (e.g. donated to Gitcoin projects)
- Used tokenized Bitcoin on DeFi protocols
- Participated in decentralized governance
What is Badger DAO?
Badger DAO aims to create an ecosystem of DeFi products with the ultimate goal of bringing Bitcoin into Ethereum. It is the first DeFi project that chose to focus on BTC as the main reserve asset rather than using ETH.
During launch, there are two main products, Sett and [DIGG](
What is Sett?
Sett is a yield farming aggregator focused on tokenized BTC. Setts can mainly be categorised in three categories.
- Tokenized BTC Vaults
- Inspired by Yearn Finance’s vaults, initial products include Bitcoin vaults that farm [CRV] such as [SBTCCURVE] [RENBTCCURVE](TBTC](SBTCCURVE metapool.
- They also collaborate with Harvest protocol to farm CRV and [FARM](tokens with RENBTCCURVE deposited in Harvest itself.
- LP vaults
- To attract more users, there is a Sett for WBTC/[WETH] that farms [SUSHI]
- Other than that, four Setts are created to bootstrap liquidity for BADGER and DIGG.
- WBTC/BADGER UNI LP
- WBTC/DIGG UNI LP
- WBTC/BADGER SUSHI LP
- WBTC/DIGG SUSHI LP
- Protocol Vaults
- Users can choose to avoid Impermanent Loss (IL) and tokenized BTC risks just by staking the native BADGER and DIGG tokens into bBADGER and bDIGG vaults, earning protocol fees and yield farming rewards.
Trivia: The word Sett is chosen as it refers to a badger’s home.
What is DIGG?
DIGG is the first elastic supply rebase token that pegged to the price of Bitcoin. The rebase mechanism works similarly to [Ampleforth] that is pegged to the price of USD. Currently, rebases are scheduled daily at 8PM UTC. Initial supply is set at 4,000 DIGG. 15% of the initial supply were airdropped to Sett users. There is a yield farm to earn DIGG alongside BADGER for roughly 22 weeks starting from 23rd January 2021.
The concept of rebase tokens is a bit abstract. Unlike normal currencies, it aims to peg its price towards a target. To do so, rebase tokens change their supply dynamically, corresponding to market demand. Below is the formula used to execute the supply rebase, with Rebase Multiplier set at 10 as DIGG aims to reach parity with BTC in 10 rebase periods.
Deviation from peg = (Current Price - Target Price) / Target Price
Rebase Amount = Current Supply * (Deviation From Peg/Rebase Multiplier)
New Supply = Current supply + Rebase Amount
For example, if a user owns 40 DIGG (1% of total supply) today with the DIGG price at $50,000 and BTC price at $40,000, the user has $2 million worth of DIGG. With the positive rebase, supply will increase by 2.5% and the price is expected to hit $48,780.49. As such, the user will end up owning 41 DIGG, worth $2 million after rebase, which is the same as before!
Other than earning more farming rewards, bDIGG is an attempt to make DIGG more composable in the DeFi ecosystem by making away with the supply changes daily. So bDIGG supply is not influenced by the rebases, while its value will represent the underlying amount of DIGG, similar to yield-bearing tokens.
What are the fees to use Badger DAO?
During the yield farming period, a withdrawal fee of 0.5% and a performance fee of 20% will be charged, with the aim to transition into 2% management fee and 20% performance fee after that. Currently the fees are only charged on Sett products.
The second is akropolis (AKRO):
As a project, Akropolis mission is to give people the tools to save, grow and provision for the future safely and without dependence on a geography, a central counterparty, or falling prey to predatorial financial practices of multiple intermediaries.
With that in mind, Akropolis has built AkropolisOS, light and modular framework for creating for-profit DAOs, with customisable user incentives, automated liquidity provision enabled by the bonding curve mechanism, and programmatic liquidity and treasury management.
Our first product, Sparta, allows taking undercollateralized loans (borrower provides only 50% of collateral), as well as to passively generate yield via integrated yield rebalancer to get maximum available APR from different DeFi protocols. All funds are pooled, and the internal economy is based on a bonding curve, which provides additional incentives to the users.
Our second product is Delphi, a yield farming aggregator with dollar cost averaging tooling. Delphi allows users to gain yield on synthetic savings, farm tokens from integrated protocols/pools, and invest in volatile assets using an active “all in” approach or a passive dollar cost averaging strategy.