What Is Alpaca Finance (ALPACA)?
ALPACA is the native token of Alpaca Finance, which is a BSC-based leveraged yield farming and lending protocol. Check out the Aplapaca Finance price chart (you can find one above) to see the current ALPACA price.
The Alpaca Finance crypto project lenders are able to generate a safe and consistent profit. Borrowers, on the other hand, can take out undercollateralized loans. They can then use these loans in leveraged yield farming positions, which provide higher yields on less capital.
There is a huge variety of farming pools that Alpaca Finance users can choose from. Besides, since Alpaca Finance runs on the BSC network, it provides users with low-cost eco-friendly transactions.
It’s also worth noting that, apart from yield farming pools, Alpaca Finance also offers Automated Vaults. A vault is a financial tool that automatically employs investment strategies to invest and reinvest assets that have been placed into that vault. As of writing this, the Alpaca Vaults offer two strategies – Market-Neutral and Savings.
The Purpose of ALPACA Tokens
Essentially, the primary purpose of ALPACA tokens is participation in the Alpaca Finance ecosystem. This means that ALPACA tokens are needed to participate in farming, staking, lending, or any other features of the network, as well as paying the network fees.
Besides that, ALPACA tokens are utilized to reward users for bootstrapping the Alpaca Finance ecosystem.
Lastly, ALPACA tokens are also used to participate in the governance process of Alpaca Finance, this way allowing users to decide on the future development of the project.
Tokenomics of ALPACA
The max supply of ALPACA tokens is 188 million. Since it has a fixed supply, the ALPACA token has a deflationary nature, which means that the Alpaca Finance price might increase as the supply becomes more scarce.
There were no pre-sale or pre-mining events for ALPACA tokens. 87% of the supply is dedicated to the users of Alpaca Finance. The remaining portion is split between the Alpaca Development Fund and Warchest (a fund dedicated to future strategic expenses).
Besides, to keep the token deflationary, Alpaca Finance takes 80% of all liquidation fees and 10% of all interest generated by lenders and then uses these funds for the buyback-and-burn mechanism. This means that Alpaca buys tokens from circulation and immediately burns them.
However, if you’re planning to buy Alpaca Finance coins, note that the ALPACA price is prone to change. This is the case because the Alpaca Finance price, just like the prices of other crypto assets, gets affected by the crypto market's volatility.
