Protocol Expansion: Prisma Finance

A little over 2 years ago, we embarked on a mission with a clear objective: to optimize and expand opportunities for Curve.fi users through meticulous implementation and a symbiotic relationship with Curve’s veToken model. Since then, Convex Finance has evolved into a hub for protocols seeking to optimize with Curve in a mutually beneficial manner. This journey has propelled Convex to extend our model to other protocols with similar token structures, namely Frax Finance’s, Frax Shares (FXS), and Frax Price Index Shares (FPIS), as well as FX Protocol (FXN).

With that said, Convex Finance is delighted to welcome the newest entrant to our ecosystem, Prisma Finance. Prisma Finance introduces a novel DeFi primitive that concentrates on unlocking the potential of Ethereum Liquid Staking Tokens (LSTs). It achieves this by empowering users to mint a stablecoin called “mkUSD,” which derives full collateral backing from LSTs.

Convex is excited to initiate a closer collaboration with the Prisma team, working together to generate more opportunities for users of Curve, Convex, and Prisma alike.

Today, Prisma Finance is launching their PRISMA token, and we are happy to serve PRISMA holders at https://prisma.convexfinance.com/.

Things you should know before participating in the PRISMA/cvxPRISMA rollout:

• As announced by the Prisma team, PRISMA tokens will initiate distribution through an airdrop to veCRV and vlCVX holders who voted for whitelisting them in the form of “locked PRISMA.” Our integration with Prisma Finance enables all airdrop participants to claim their PRISMA tokens via Convex Finance, as cvxPRISMA. This immediate conversion facilitates liquidity and transferability.
• Similar to the CRV and cvxCRV relationship, the claimed PRISMA tokens will be automatically transformed into cvxPRISMA, and the original PRISMA tokens will be permanently locked.
• PRISMA tokens locked within Convex will remain inaccessible for the maximum lock duration in perpetuity.
• The conversion process will be unidirectional; cvxPRISMA tokens cannot be reverted back to PRISMA tokens. However, users will always retain the option to exchange between the two tokens using liquidity pools on Curve Finance. Exchange will be facilitated at the Curve Finance conversion rate.
• vlCVX users will determine how Convex Finance allocates vePRISMA vote weighting in Prisma Finance’s governance. (For further insights into Prisma governance, click here.)
• Users can stake cvxPRISMA on Convex Finance to earn a share of fees obtained by staking their vePRISMA tokens. Additionally, users may receive native CVX rewards from the platform.

For the latest updates on cvxPRISMA, keep an eye on our Twitter channel and Discord server, as well as Prisma Finance channels. Detailed information is readily available on our platform documentation and Prisma Finance documentation.