LBP FAQ
LBP specific FAQ
How do LBPs work?
Liquidity Bootstrapping Pools (LBPs) are dynamic pricing mechanisms that help projects discover a market-driven token price. The price typically starts high and gradually decreases over time based on weight shifts between the project token and a paired collateral (usually USDC or WETH). However, if demand is high, early buys can increase the price temporarily.
This design discourages bot sniping at the start of the sale and enables true price discovery through user participation over time.
What are weights in relation to LBPs?
Weights determine the price movement in an LBP. A higher weight for the project token (e.g. 99/1) means a high initial price. As the LBP progresses, the weights shift—commonly toward something like 1/99—causing the price to decline if no one is buying.
The change in weights is what drives the price curve and enables a market-driven sale.
What should the start and end weights be?
We recommend:
Start weight: 99/1 (99% token, 1% collateral)
End weight: 1/99 (1% token, 99% collateral)
This structure starts your token at ~8x the intended market price, deters bots, allows for true price discovery, and enables 100% token distribution (nuance applies).
If your goal is to sell fewer tokens at higher prices, you can end with token-heavy weightings like 70/30 or 60/40, though this limits distribution.
As a rough guide:
99/1 → 1/99 → ~100% sold
99/1 → 10/90 → ~90% sold
99/1 → 25/75 → ~75% sold
These are just benchmarks—results vary based on demand.
What should I set as the starting price?
The starting price should typically be 6–8x higher than your expected fair market value. This pricing is not fixed directly but is derived from your chosen weights and collateral ratio.
For example: If you believe your token should be worth $1, the LBP starting price may be configured to open at $6–8 using a 99/1 weight.
This discourages bots and encourages real participants to wait for a price they consider fair.
Do I need to provide initial liquidity?
No. Fjord supports zero liquidity LBPs, meaning you don’t need to deposit real collateral at the beginning. Instead, you define a virtual collateral amount (synthetic liquidity), which is used to generate the price curve.
The first real participant deposit merges into the pool and activates the pricing mechanism.
Can participants both buy and sell tokens during an LBP?
That depends on your configuration. You can choose between:
Buy and sell LBPs (most common)
This is set during the sale setup process and shown clearly on the public interface.
Are there hard caps or wallet limits?
LBPs do not support wallet limits, but you can optionally set a hard cap for the sale. Once this cap is reached, no further purchases will be accepted.
Can I change the token weights during the LBP?
No. Token weights cannot be changed after the LBP has started. You must finalize your configuration prior to launch.
Can I change any parameters after the LBP starts?
During the LBP, the following actions are available:
Pause or resume swaps (temporarily stopping new participation)
Hide the sale from the public interface
Withdraw raised funds (after the LBP ends)
Token weights and pricing parameters cannot be altered during the event.
Can you share some examples of past LBPs?
Autonolas ($OLAS)
Weights: 99/1 → 2/98
Initial Liquidity: $50k
Funds Raised: $550k
Tokens Sold: 99%
FDV: $39M
Altitude ($ALTD)
Weights: 99/1 → 70/30 (with a hard price floor)
Initial Liquidity: $30k
Funds Raised: $3m
Tokens Sold: 30% of available tokens
FDV: $30M
These examples show how project demand, token availability, and weight configuration can all significantly affect outcomes.
What happens after the LBP ends?
Once the LBP ends:
Tokens can be claimed by participants
Collateral is sent to your wallet (minus the 5% Fjord fee)
You can optionally enable a claim delay to allow time for LP setup
How long should an LBP run?
Most LBPs on Fjord run between 2–5 days. Shorter sales create urgency; longer sales give more time for natural price discovery. If you’re unsure, 3 is a good middle ground.
Can I change weights or parameters mid-sale?
No. Token weights and pricing mechanics cannot be changed once the LBP has started. You can:
Pause or resume swapping
Hide the sale from public view
Withdraw funds (after the LBP ends)
For best results, always test your configuration on Sepolia first.
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