Buffer Finance: The On-chain Peer-to-Pool Options Trading Protocol
The Buffer protocol is a make-do Automated Market Maker (e.g., PancakeSwap), except that it is non-custodial on-chain peer-to-pool. However, the non-custodial property only stands for assets on Futures trading and not Spot trading. The buffer platform is a 100% decentralized options trading platform. In contrast to other options markets where a buyer and seller are involved, in Buffer, the seller takes the position through a liquidity pool.
A simplified and more efficient way to make options trading accessible to everyone in the project’s goal. The founder of Buffer Finance, Ric Feynman, holds a degree in engineering and has worked in the financial and data industries. Co-founder Heisenberg is a Solidity developer with experience building highly scalable apps and finance software. Having traded crypto and options for the past three years, both of them identified several gaps Buffer could fill.
Buffer Finance has a mainnet, which came about after its Testnet counted more than 1000 participants. The financial platform currently supports BNB, BTC and ETH.
How the Protocol Works
The protocol involves three parties, and the procedure is as follows:
Liquidity Providers (LP)
LPs contribute liquidity to the liquidity pool and get write buffer tokens ($rBFR) in exchange. The offered liquidity writes both calls and put options, with the premium paid by the option buyer (strike fee + option fee) dispersed as yield to $rBFR holders.
The BNB liquidity pool is live and moving to ETH, BTC, and a stable currency to facilitate different crypto and stocks options. The Buffer protocol team plans to launch a liquidity pool-based stablecoin.
Liquidity providers on the Buffer protocol are looking at APR returns of about 138% or more.
Option Buyer
An option buyer can configure the strike price, expiration date, and option size after paying an option premium and a settlement charge to acquire a put or call option on any supported assets. This alternative can be carried out on-chain against the liquidity pool at any time before the expiry date.
Token Holders ($iBFR)
$iBFR is the Buffer Protocol’s native token; $iBFR holders may buy and stake tokens to gain access to various utilities.
- Perpetual revenue share: by participation in our staking pool
- Liquidity mining incentives: become an LP on AMMs like and invest to receive $iBFR benefits. One can also add liquidity to the BNB pool for writing options, then mine $iBFR tokens by staking$rBFR
- Governance: Take part in the development of governance proposals.
- Discount on the prediction game ticket price: will be applied later
- Milestone-based burn and buybacks: the platform will disclose repurchases regularly to reduce token supply.
Buffer Features
$iBFR token
Hold to get a continuous revenue share, stake to receive liquidity mining incentives, and vote for features or burn to participate in our milestone-based buybacks. The $iBFR token is the foundation of the Buffer protocol. Invest in them to generate passive income or to participate in governance.
Holders of the $iBFR token receive a discount on the settlement fee necessary to cast a bet in the BNB price prediction game. It encourages $iBFR holding as well as user engagement in the game.
Following the first quarter of 2022, protocol feature releases will be decided by $iBFR token holders.
Bidirectional liquidity pools
The platform allows one pool to write both put and call options with no separate USDT and BEP-20 pools required.
Customizable
Buffer allows users to set their strike price, expiry date.
No Counterparty
On Buffer, users create all options against a liquidity pool.
Prediction game
Users can participate in prediction games by predicting BNB price movement. They can then place their bet directly against a liquidity pool — (No counterparty required).
Insurance
Users can also buy insurance on their BNB holdings to protect themselves from sudden price fluctuation.
Better and Safer for all?
Buffer gives crypto option traders what they want by offering a variety of analytics, high leverage, and insurance.
There are insurance funds for launch sites and service companies that have a high number of BNB claims. Speculators can engage in BNB price prediction games by betting on price changes. They can pay a betting fee against a liquidity pool without the requirement for a counterparty. Traders can freely purchase Put or Call options based on their BNB positions or trade customized options depending on their opinion of BNB price movement.
Buffer values the community and seeks to create consumer confidence by publicizing its objective to make derivatives trading accessible to everybody and share 100% of protocol fees to all token holders. Its work is made entirely public and is examined many times by high-quality auditors to maintain openness. Buffer pledges focus on continuous improvement and become more environmentally friendly as BSC transactions get quicker and have a lower carbon impact.
Pros
- Customizable: Any strike price can get chosen by the option buyer.
- Non-custodial: All liquidity is controlled automatically by an immutable smart contract.
- Trustless: Each contract is settled on-chain in a trustless manner (Fully decentralized)
- American-style options: This can be used at any time before it expires.
- There is no liquidity risk: Locked liquidity eliminates counterparty and liquidity concerns for option purchasers.
- No-censorship: No KYC or registration is necessary.
- Yield-farming: Earn a return on any BEP-20 token (Starting with WBNB, WETH, and WBTC)
- Liquidity provider diversification: Diversify risk by using a single liquidity pool for both call and put options.
Cons
- LPs risk facing losses if the assets’ prices follow one direction sharply. However, as investors buy more options and the markets correct this risk may become less of a worry to investors.
- Low Market Cap: The developers maintain a low market cap; therefore, climbing through ranks in the crypto industry is complex.
$iBFR Token Details
Token Utility:
Revenue share: Invest in $iBFR to earn a steady stream of passive income.
Generate revenue: It happens through staking $iBFR LP pair tokens in liquidity mining.
Deflationary: Buybacks based on milestones and manual burning
Governance: Following the introduction of the Q1 2022 plan, the platform will regulate all feature releases by $iBFR token holders.
Holding $iBFR tokens entitles you to a discount on the settlement fee necessary to put a bid in the BNB price prediction game.
Distribution
- Seed Sale 14%: 14,000,000
- IDO 11%: 11,000,000
- DAO Allocation 5%: 5,000,000
- Team 10%: 10,000,000
- Treasury 10%: 10,0000,000
- Advisors & Partnerships 10%: 10,000,000
- Rewards & Marketing 13.5%: 13,500,000
- Airdrop + LeaderBoard 1.5%: 1,500,000
- Liquidity and Liquidity mining 20%: 20,000,000
- rBFR (Buffer LPs) staking rewards 5%: 5,000,000
- Total 100%: 100,000,000
The token distribution is evenly balanced, which helps to keep the value and supply of $iBFR stable. Buffer intends to issue a high-quality mix of token allocations and holder incentives to ensure continual growth and price.
The Team Behind Buffer
Buffer’s team comprises experts with diverse backgrounds, including solidity development, marketing, options trading, UI/UX design, and developing highly scalable backend systems. Feynman (Co-founder) is in charge of business development, marketing, and product growth, while Heisenberg (Tech Co-Founder) is in charge of product development and management of the tech team.
You can find more information about Buffer Finance via the social media handles below:
Website: https://www.buffer.finance/
Deck: https://bit.ly/2XaYLoX
Whitepaper: https://docs.buffer.finance/
Twitter: https://twitter.com/Buffer_Finance
Telegram: https://t.me/bufferfinance
Blog: https://buffer-finance.medium.com/
GitHub: https://github.com/Buffer-Finance
App: https://testnet.buffer.finance/
Disclaimer: This article is not intended to be a source of investment, financial, technical, tax, or legal advice. All of this content is for informational purposes only. Readers should do their own research. The Capital is not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by reliance on any information mentioned in this article.
