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Octopus Protocol Litepaper V1.0An Introduction to the Octopus Protocol EcosystemMarch 2021
Table of ContentsSummary2Introduction3What is Octopus Protocol?4Eight Pillars of Octopus Protocol5Unparalleled Access to Real-World Assets5Minimal Usage of Oracles5Limitless Design Possibilities6Customized Derivative Contracts6Non-Custodial6Governance7Trustless Architecture7Affordable Solution7Octopus Protocol Products8Decentralized Derivatives Exchange8Decentralized Asset Management9Social Trading10Options Trading11Token Model12OPS Token13Tokenomics - OPS Token14Stablecoin Explanation17Founding Team and Advisors18
SummaryOctopus is an open protocol to create, exchange, settle, and managesynthetic assets. The protocol enables the issuance of synthetic tokens andtheir exchange through decentralized derivatives. Octopus Protocol leveragesinnovative technological solutions like blockchain and smart contracts tofacilitate a platform for engagement with decentralized derivatives. Througha trustless architecture, Octopus seeks to offer unparalleled access andexposure to real-world assets.The benefits of issuing derivatives on the blockchain have led marketparticipants to develop DeFi protocols facilitating architecture fortailor-made synthetic tokens. However, market protocols demand greaterrequirements of collateral in exchange for minting synthetic tokens on theirplatform. Octopus Protocol provides an affordable solution and accessibleinfrastructure by reducing the gap between collateral and creating tokens tofacilitate an optimal solution for DAO and developers to issue syntheticassets.Octopus Protocol Litepaper - March 2021 Page 2
IntroductionA financial derivative represents acontractual agreement between twoparties that derives its value basedon the performance of an underlyingasset. With this financial instrument,parties exchange cash or any otherasset instead of trading or owningthe actual asset.Financial derivatives, whichemerged in the 1930s, became oneof the most prominent financialinstruments due to their inherentusability. This financial instrumentfacilitated market participants toinsure assets at a specific price inthe future without actually owningthem. It further allowed commodityproducers to form an agreement tobuy or sell a commodity at apredefined price in the future andprotect themselves against the pricevolatility in commodity prices.intermediaries and expensive legalbinding contracts. Today, the financialderivatives market is restricted, holdscounterparty risks, is highlydependent on intermediaries, boundwith geographical limitations, and isan overall costly process.Octopus Protocol enables adecentralized and open infrastructurefor minting and settling financialderivatives without relying onthird-party intermediaries. TheProtocol leverages blockchaintechnology to tokenize syntheticassets on the distributed ledger.Synthetic tokens follow a specificfunction, such as the price of anunderlying asset without actuallyowning it. The Octopus ecosystemencompasses several products tocreate, exchange, and managesynthetic assets on its network.Financial derivatives offeringservices of exchanging assets relyon a centralized structure forprocessing and clearing. Theirpopularity led to the establishmentof Over the Counter (OTC) derivativedesks, which monitored a legalagreement that specifies the termsand conditions of involved parties.However, this further created adiscrepancy as the entire systemdepended upon trustedOctopus Protocol Litepaper - March 2021 Page 3
What is Octopus Protocol?OCTOPUS PROTOCOL, A ROBUST DEFI PROTOCOL BUILT ON THEBINANCE SMART CHAIN (BSC), ALLOWS ISSUANCE, TRADE, ANDMANAGEMENT OF DECENTRALIZED DERIVATIVE ASSETS.Its trustless architecture enables developers, individuals, and decentralizedautonomous organizations (dao) to deploy and create synthetic assets on thebsc network.These synthetic assets, built on theblockchain, can represent an underlyingasset in the physical world. Synthetictokens track the real-time price of anunderlying asset using oracles andgive exposure without owning thereal-world asset.TRADEISSUEMANAGEUnder the Octopus ecosystem,BORROWLENDtokenized synthetic assets can directlybe traded on a peer-to-peer network.The entire operation of minting andtrading synthetic tokens is governed byautomated smart contracts. This removesthe need to rely on a third-party intermediary with the protocol ensuring atrustless environment.Tokenization of synthetic assets on the blockchain also allows fractionalownership of the underlying asset. With blockchain, Octopus provides thenecessary tools to fractionally divide an asset into desired units (tokens) andmint them on the BSC network. This allows users to raise synthetic tokens forany form of tangible or physical assets.Octopus Protocol Litepaper - March 2021 Page 4
Eight Pillars of Octopus ProtocolUnparalleled access toreal-world assetsMinimal usageof oraclesLimitless designpossibilitiesCustomized derivative contractsNon-CustodialGovernanceTrustless architecturefordecentralized derivatives1. Unparalleled Access to Real-World AssetsWith traditional financial derivatives, trusting the counterparty to hold its end of theagreement remains one of the biggest challenges. Hence, financial derivatives areonly accessible to institutional investors relying on costly legal processes and trustedthird-party intermediaries.Decentralized Finance allows any individual, DAO, or party to have equal access tofinancial tools without centralized control or third-party intermediaries. The OctopusProtocol uses the innovation of DeFi to offer unparalleled access and exposure toreal-world assets in an equally accessible financial ecosystem.2.Minimal Usage of OraclesOracles help in accessing outside data, like price feeds, for synthetic assets. They areprogrammed to fetch rates from reputable sources and report them to smart contracts.Hence, the price of on-chain synthetic assets is pegged to the price of real-world assetssupplied by oracles.However, current oracle solutions are vulnerable in their design, i.e., they are susceptibleto corruption. If the oracle is compromised, it can result in the manipulation of the smartcontract. To minimize the loophole of corruption within the oracles, Octopus Protocol isdesigned to minimize the usage of oracles. By providing off-chain data for blockchaintransactions in an incentivized environment, Octopus reduces the reliance on oraclesand increases security within its ecosystem.Octopus Protocol Litepaper - March 2021 Page 5
3. Limitless Design PossibilitiesOctopus allows users to create a basket of tokens to diversify cryptocurrencyinvestment portfolios and minimize financial risks. The basket is represented by asynthetic asset that calculates the overall price of all the instruments. Moreover, thebasket of assets is not limited to cryptocurrencies. It can include several investment fiatcurrencies, commodities, digital assets, bonds.The Protocol allows any participant to access financial contracts or derivatives fromany part of the world through synthetic tokens. For instance, an entity from adeveloping nation can access Australian stocks through minting synthetic tokensrepresenting the underlying asset, i.e., Australian stock. The price difference of the stockcan be tracked through an oracle, and the contractual agreement is controlled by asmart contract.4. Customized Derivative ContractsTraditional financial derivative contracts offer limited access to a handful of individualsand institutions. Octopus Protocol allows exposure to any kind of financial derivativeswithout any restrictions on geographical boundaries and limitations of the currentfinancial ecosystem.Customized financial contracts have never been available to individuals as the costsfor doing so have been restraining. However, Octopus Protocol facilitates contractsthat fit personal circumstances along with preferred investment instruments.5. Non-CustodialTokenization refers to the representation of a real-world asset on the blockchain in theform of digital tokens. Synthetic tokens provide accessibility and leverage to the assetwithout going through the tedious process of owning the asset. They are also moreaffordable to hold as compared to real-world asset-backed tokens. Synthetic tokensalso provide censorship resistance (non-custodial) which asset-backed tokens cannotoffer due to custodian restrictions.Octopus Protocol Litepaper - March 2021 Page 6
6. GovernanceOctopus Protocol is governed by anyone who owns OPS tokens, Octopus’s nativecurrency, in a fair and transparent way. All OPS token holders can propose a change tothe protocol or vote on existing proposals.Therefore, the role of OPS tokens includes acting as an incentive for liquidity providersand being a governance vehicle for the decentralized infrastructure.7. Trustless ArchitectureThe current infrastructure for financial derivative contracts requires intermediaries thatgovern, manage, and enable trust between two entities. These standards of engagingwith derivatives are expensive, time-consuming, and require resources. The trust-basedcontracts also restrict access to derivative contracts in a traditional financialinfrastructure.Octopus Protocol leverages the innovation of blockchain and automated smartcontracts to remove the factor of dependency on third-party intermediaries. Instead, alloperations are managed by a pre-programmed network of smart contracts, which areautomatically executable. Octopus is a DeFi protocol powered by smart contracts; itsinherent infrastructure eliminates trust barriers for trade and settlement of derivatives.8. Affordable SolutionModern DeFi derivative solutions restrict innovation by demanding a higher deposit forcollateral in exchange for the issuance of tokens. Octopus provides an affordablesolution to mint tailored synthetic assets by reducing the requirement for a high(amount) of collateral.Octopus Protocol Litepaper - March 2021 Page 7
Octopus Protocol ProductsTradersBUILDDevelopersDerivative nagementStakersSocialTradingOptionsTrading1. Decentralized Derivatives ExchangeDecentralized derivatives built on blockchain carry applications in the financial ecosystem.Synthetic derivatives provide benefits of hedging, thereby allowing users to manage risks. The factorof hedging allows a user to offset a potential loss by fixing a predictable amount that would be paidfor the pre-defined price of any asset within a specified duration of time.Octopus provides an architecture for secure and automated exchange of decentralized derivativesin a trustless environment. It facilitates a permissionless way to exchange and settle derivativeswithout any third-party intermediaries or centralized entity governing operations.Octopus Protocol Litepaper - March 2021 Page 8
Trade DerivativesThe decentralized exchange or DEX allows trading of derivatives facilitatingunlimited exposure to several instruments, including stocks, bonds, equities,digital assets, futures, and more. Users can trade derivatives with tighttrading spreads, low margin requirements, and innovative hedge instrumentsthat do not liquidate assets prior to settlement.Non-Custodial WalletOctopus holds users’ funds in a non-custodial manner. In other words, a userremains in complete control over their digital assets. You can also track yourtrading history and cryptocurrency trading portfolio from your wallet.Minimal CollateralThe Octopus ecosystem offers affordable solutions to create syntheticassets. Moreover, it provides institutional-grade services for the issuanceof synthetic assets by depositing a minimum amount for collateral.Trustless ArchitectureExchange derivatives on an infrastructure that offers best-class features of acentralized exchange but on a decentralized and peer-to-peer architecture.Minimal Trading FeesAccess the deep liquidity of Octopus Exchange at minimal trading feesand competitive processing charges.StakingGain rewards and annual returns as high as %220* by participating in theOctopus network. Earn its native token, OPS, by engaging in the stakingmechanism available on the Octopus platform.Octopus Protocol Litepaper - March 2021 Page 9
2. Decentralized Asset ManagementDecentralized asset management facilitates a transparent and open way of settling synthetic assetsby connecting investors to asset managers. Users can view the entire history and performance of anasset manager before investing their funds into pools.TransparencyOctopus connects investors to asset managers in a transparent way onpeer-to-peer infrastructure.Tested-ToolsGet first-hand access to tools to create, rebalance, and manage yourcrypto portfolio.DiversifyAccess Octopus to diversify your trading portfolio comprising severalinstruments, including traditional financial tools like stocks, bonds, andindices as well as digital assets.Track HistoryView the complete history of asset managers before choosing to investyour funds into their baskets.Binance Smart Chain (BSC)To enhance scalability, Octopus Protocol uses the Binance Smart Chain(BSC) blockchain network to create and manage synthetic assets.Octopus Protocol Litepaper - March 2021 Page 10
3. Social TradingSocial trading allows novice traders to get first-hand access to trades executed by expert investors.It will enable beginners to the leading expertise and insights of experienced traders. Social tradingallows users to follow the same trades of their preferred trader.Gather LeadsThe social trading feature facilitates users to gather expert insights andleads from experienced traders.Expert TradesA user can follow the trading patterns, strategies, and trades of theirpreferred trader.Tool for BeginnersNovice traders, can use social trading and access the best trading experienceby following the trading patterns of expert traders in the industry.SecurityThe trading experience of Octopus offers an intuitive, low-cost, and securemethod of setting your account and accessing social trading features.StrategiesOctopus Protocol offers complete transparency on the performance ofcollective strategies, how they are set up and operated.Octopus Protocol Litepaper - March 2021 Page 11
4. Options TradingOptions trading, a type of derivative, offers an investor the right but not obligation to buy or sellan underlying asset at a predetermined price at the set expiration date. With Options trading,individuals or entities can tokenize any asset such as stocks, equities, or bonds into synthetictokens and gain exposure to financial gains of such instruments.Crypto options offer a relatively low-cost and low-risk solution for trading any asset as comparedto trading futures. This instrument allows traders to hedge or speculate the future price of anunderlying asset.HedgingOptions trading allows an investor to seek financial gains and minimizethe price risk of any asset against a change in market conditions.Competitive Market FeesSettle options contracts on Octopus with best-class services, includinga competitive rate for settlement fees, which is a small portion of theunderlying asset value.Swap Synthetic AssetsThe decentralized environment of Octopus, ensures no restrictions on tradingpairs. Any synthetic asset can be swapped for another without any limitations.Minimal RequirementsIt is a decentralized exchange or DEX platform. It is permissionless andhence does not require the user to provide several documents during thesign-up process.Octopus Protocol Litepaper - March 2021 Page 12
OPS IS THE NATIVE UTILITY TOKENOF THE OCTOPUS PROTOCOLValue Accrual OPS tokens accrue value from platform fees paid for engaging and accessing the productsand services of Octopus Protocol ecosystem - from the creation of synthetic assets toexchanging derivatives on trading platforms.This enables Octopus to unlock value pools:UNPARALLELED ACCESSTO REAL-WORLD ASSETSOctopus Protocol Litepaper - March 2021A BORDERLESS AND PERMISSIONLESSDEFI INFRASTRUCTURE Page 13
The OPS token serves three distinct purposeGovernanceStakingEngagement OPS tokens are used byparticipants to govern theOctopus Protocol, ensuringconsensus in decisions in adecentralized network.Buyers and sellers can lock their OPS tokens as a part of stakingoperations and receive rewardsfor committing deposits. Thislocks up OPS and reducescirculating supply.OPS tokens are used toincentivize actions across theOctopus Protocol ecosystemin several ways. They are ameans to internally access theOctopus system for engagingwith its products and services.Tokenomics - OPS TokenToken Symbol OPSTokens being offered in Pre Public Sale10,500,000Total Suply150,000,000Octopus Protocol Litepaper - March 2021Initial Circulating Suply1,950,000 (1.3%)Percentage of Tokens offered in Pre Public Sale7% of TotalStarting Price Pre-SaleUS 0.15 Page 14
Token Distribution and Use of Funds10%2%EventsCommunity and PRExpansionSeed21%Stacking Reward AndLiquidity Miniing7%Partnerships AndEcosystem Expansions5%Product DevelopmentInitial Liquidityand Market MakingUSE OFFUNDSMarketingOperations6%Legal and Compliance5%Exchange ListingAdvisors andLegal Team12%10%10%10%3%18%2% Pre Sale ( IDO )1% Community5%15%Smart Contract AuditsPlatform Development8% Private BTOKENDISTRIBUTION3%6%17%3%Bug BountyExhibitionsPrivate A3%HackathonsPartnerships & NetworkDevelopmentTeamMarketing and PRBusiness Development11%Ecosystem GrowthTotal Supply 150,000,000SEED (CLOSED)15,000,000PRE SALE (IDO) (CLOSED)3,000,000ADVISORS AND LEGAL TEAMPRIVATE A (CLOSED)10,500,000COMMUNITY (CLOSED)1,500,000TEAMPRIVATE B (CLOSED)12,000,000INITIAL LIQUIDITYAND MARKET MAKING7,500,000MARKETING AND PR7,500,00015,000,00015,000,000PRODUCT DEVELOPMENTPARTNERSHIPS ANDECOSYSTEM EXPANSIONSBUG BOUNTY22,500,0004,500,0004,500,000STACKING REWARD ANDLIQUIDITY MINIING31,500,000Octopus Protocol Litepaper - March 2021 Page 15
Vesting ScheduleSEEDPRIVATE APRE SALE ( IDO )COMMUNITYINITIAL LIQUIDITY AND MARKET MAKINGADVISORS AND LEGAL TEAMTEAMMARKETING AND PRPRODUCT DEVELOPMENTPARTNERSHIPS AND ECOSYSTEM EXPANSIONSBUG BOUNTYSTACKING REWARD AND LIQUIDITY MINIINGPUBLIC SALE ( DEX offering )1. Seed - 10% of tokens were sold during our seed roundin 2020 with the price of token at 0.05, 3-month cliff,10% Release after 3-month cliff, Linear Release dailyover 6 months for remaining 90%.2. Private A/ Private B (Closed) - 15% of tokens will besold in private A and B sale rounds. Price of tokens inthe early rounds ranged from 0.075 to 0.1 per tokenrespectively, with 3 months cliff on Private A and 1month cliff on private B, 15% Release after the cliffperiod, then Linear Release daily over 6 months forremaining 90%.3. Community Sale (Closed) - 1% of tokens were sold inour community round for 0.125 per token price. Vestingon community sale is 40% on TGE, 20% Weekly LinearRelease, 1-Hour Post TGE.4. Pre-Sale (IDO) (Closed) - 2% of tokens were sold inthe pre-sale round. In this round, the OPS token ispriced at 0.15 per token. The collection made via presale will be used to add liquidity to the initial DEX listing.Vesting on Pre-sale is 40% on TGE and 20% weeklylinear release.5. Initial DEX and CEX Liquidity - 5% of tokens will beused for initial DEX and CEX liquidity. There is no vestingperiod for liquidity tokens and 100% tokens will bereleased during the listing.PRIVATE B7. Team - 10% of OPS tokens are reserved for theOctopus team members and will unlock after 6 monthscliff, 15% release, and linear release over the following 6months.8. Marketing and PR - 10% of OPS tokens arereserved for marketing and PR activities to enablewidespread adoption of Octopus Protocol and expandour commu-nity.9. Product Development - 15% are reserved for thecommercial development entity of Octopus Protocol tobuild on these technological concepts for many years.5% tokens will be unlocked at TGE and linear releaseafter month 1 through month 6.10. Partnerships And Ecosystem Expansions - 3% isreserved for allowing strategic partners and industryplayers to come on board and engage with the expansion of the Octopus ecosystem.11. Bug Bounty - 3% is reserved for current, and futureOctopus community for several activities like hackathons, growth campaigns and will be released onMainnet for auditing and bounties needs.12. Stacking Reward And Liquidity Mining - 21% of OPStokens are reserved for block rewards, staking, andliquidity mining. These tokens will be unlocked with adecreasing inflationary curve, starting with the main netlaunch on the BSC network.6. Advisors - 5% of OPS tokens are reserved for currentand future Octopus advisors and will unlock after 6months cliff, 20% release, and linear release over thefollowing 6 months.Octopus Protocol Litepaper - March 2021 Page 16
OPS are designed to be utilised, and that is the goal of the OPS distribution. In fact, the project to developOctopus Protocol would fail if all OPS holders simply held onto their OPS and did nothing with it. Inparticular, it is highlighted that OPS: (a) does not have any tangible or physical manifestation, and does nothave any intrinsic value (nor does any person make any representation or give any commitment as to itsvalue); (b) is non-refundable and cannot be exchanged for cash (or its equivalent value in any other digitalasset) or any payment obligation by the Company, the Distributor or any of their respective affiliates; (c)does not represent or confer on the token holder any right of any form with respect to the Company, theDistributor (or any of their respective affiliates), or its revenues or assets, including without limitation anyright to receive future dividends, revenue, shares, ownership right or stake, share or security, any voting,distribution, redemption, liquidation, proprietary (including all forms of intellectual property or licencerights), right to receive accounts, financial statements or other financial data, the right to requisition orparticipate in shareholder meetings, the right to nominate a director, or other financial or legal rights orequivalent rights, or intellectual property rights or any other form of participation in or relating to OctopusProtocol, the Company, the Distributor and/or their service providers; (d) is not intended to represent anyrights under a contract for differences or under any other contract the purpose or pretended purpose ofwhich is to secure a profit or avoid a loss; (e) is not intended to be a representation of money (includingelectronic money), security, commodity, bond, debt instrument, unit in a collective investment scheme orany other kind of financial instrument or investment; (f) is not a loan to the Company, the Distributor or anyof their respective affiliates, is not intended to represent a debt owed by the Company, the Distributor orany of their respective affiliates, and there is no expectation of profit; and (g) does not provide the tokenholder with any ownership or other interest in the Company, the Distributor or any of their respectiveaffiliates.Notwithstanding the OPS distribution, users have no economic or legal right over or beneficial interest inthe assets of the Company, the Distributor, or any of their affiliates after the token distribution.Octopus Protocol Litepaper - March 2021 Page 17
LARV - StablecoinOur native token, OPS, enables engagement and access to the Octopus Protocol ecosystem. The OPS tokenfacilitates the issuance of synthetic assets like dollars pegged to fiat currencies, precious metals, stocks, bonds,indices, and even digital assets.In the Octopus Protocol ecosystem, OPS is held as collateral to create any synthetic asset. The Octopusecosystem also encompasses another coin: Larvae (LARV) - a stablecoin pegged to the U.S. Dollars to enable valueproposition and deliver more utility to traders.The term Larvae, pronounced as Laa-Vee, refers to baby octopuses. This significance relates to the fundamentalsthat we are trying to achieve in the Octopus ecosystem.LARV has a native use case in the Octopus system.The traders holding LARV will have greater leverage opportunities in the trades conducted onthe decentralized derivatives exchange platform of Octopus Protocol. Traders can use the stablecoin token toleverage features such as no transaction fees for internal trading on the decentralized derivatives exchange. Forinstance, a trader can convert synthetic gold into synthetic Bitcoin on the Octopus exchange without incurring anytransaction fees through LARV. The native use-case of LARV helps deliver flexibility and convenience to traders forinternal functioning on the derivative exchange platform.The LARV stablecoin is only used for Octopus Protocol and does not hold any use-case beyond its ecosystem.While OPS holds value accrue and is essential to engage with the Octopus Protocol ecosystem, LARV holds itsnative use-case within the decentralized derivatives exchange platform of Octopus Protocol. The correlationbetween OPS and LARV relates to the same phenomenon of Octopus and Larvae.Octopus Protocol Litepaper - March 2021 Page 18
TeamFounding TeamObaid Bin TouqMonkFounder of more than 13 businessentities.Monk, one of the early believers in theCo-FounderCo-FounderHe is amongst the few people in theworld who started mining Bitcoin on hiscomputer in his home during its initialyears and invested in Ethereum ICOheld in 2014.Heading the Bin Touq Fire and Safety,company in Dubai UAE since 11 years.Provided his services for the Dubai11 years.more than 12 years and investing incrypto projects since the last 10 years.Key Team MembersIgor SamorodovCMOChristopher RedmanCreative DirectorPavel MironchikLead UI/UX DesignerMahmoud AliGraphic DesignerAdvisorsSanjay ChandelKyle ChasseVikas ThaparVishal SanghaniLaunching the commodityexchange venture andasset managementbusiness as CEO atIndiabulls.Kyle Chassé, theVikas Thapar hasheaded several bankingoperations in prominentfinancial institutions.Experience of more than 15years in open-sourcetechnologies amongst others.Securities and ExchangeBoard of India (SEBI) for 11years.CEO at the IndianCommodity Exchange(ICEX)founder and CEO ofPaid Network, is acryptocurrency/blockchain veteran withover 10 years ofexperience. He hasguided a myriad ofearly-stage crypto andblockchain projects andWith over 25 years ofexperience working inthe financialecosystem, he bringshis leading insights andvaluable practices tothe Octopus Protocol.Engaged with eight prominentcompanies including McAfee,Tata Consultancy Services,DellEMC, and Cohesity Expertise inweb design, development,project management, andproject deployment.helped them to succeed.Octopus Protocol Litepaper - March 2021 Page 19
READY TO LEARN MORE?View more information to jointly reshape the industrystandards for synthetic assets and derivatives.PITCH DECKWEBSITEOur Pitch deck canbe viewed hereCheck our websitefor more informationTECHENQUIRIESMARKETSAND INVESTORSContact us formore informationConnect with usONE-PAGERCheck ourone-pager hereStay Updated With Latest Information from Octopus us Protocol Litepaper - March ctopusprotocol.medium.com Page 20
Octopus provides an architecture for secure and automated exchange of decentralized derivatives in a trustless environment. It facilitates a permissionless way to exchange and settle derivatives without any third-party intermediaries or centralized entity governing operations. Traders Stakers Octopus Protocol Ecosystem Options Trading Social .
