OKX’s Jumpstart new coin mining activity officially began today (13th). Due to the limited participation in mining using TON tokens, the borrowing interest rate for TON tokens has skyrocketed to 365%. Are there any arbitrage opportunities?
(Previous Summary:
Market dark horse! Telegram’s TON public chain’s TVL has surged 400% in the past two months, and the coin price has risen 20% to a new historical high in a single week.)
(Supplementary Background:
Telegram game Notcoin listed on Binance and OKX for “new coin mining,” TON surges 10% surpassing Dogecoin in market value.)
Table of Contents:
OKX Jumpstart launches Notcoin new coin mining rules
$TON borrowing interest rate soars to 365%
Is it profitable to borrow TON for mining?
Can TON loans be used for arbitrage?
TON has surged by up to 5.8% in the past 24 hours.
Backed by the communication giant Telegram, the popular mobile mining game Notcoin, based on the TON blockchain, went live on the Binance Launchpool and OKX’s Jumpstart for new coin mining today. Due to the limitation of TON token usage for mining in OKX Jumpstart, the borrowing interest rate for TON tokens has surged, with an annual rate as high as 365%.
Last Thursday (9th), OKX announced that the new coin mining activity for Notcoin would go live on Jumpstart today. Here are the activity rules:
– The participation time for OKX in Notcoin new coin mining is from May 13th, 14:00 to May 16th, 16:00.
– OKX will use TON token staking for mining. The more staked, the higher the earnings, but the individual staking limit is 4,000 TON.
– OKX Jumpstart does not support participation from users in mainland China, Hong Kong, and South Korea.
– OKX Notcoin launch pool has a total of 1,283,990,271 NOT tokens, accounting for 1.25% of its total supply.
Due to the high popularity of Notcoin new coin mining, the borrowing interest rate for TON tokens on the OKX exchange has surged to 365%. At the time of writing, due to excessive demand for borrowing, OKX lending has reached a point where it is impossible to borrow TON tokens.
At the same time, the borrowing interest rate for TON on the Bybit exchange has also reached 283.8%.
Why would many people borrow TON despite the high borrowing interest rate to participate in mining activities? Perhaps we can observe the returns of previous OKX Jumpstart rounds.
Firstly, the Notcoin new coin mining activity lasts for three days. Assuming we need to borrow TON with a 365% annual interest rate for three days, we would need to pay 1% interest daily on average. In other words, in order to offset the interest, the new coin activity needs to generate a return on investment of 3% over three days (365% annualized return).
According to the previous six rounds of OKX Jumpstart new coin mining activities, the highest annualized returns for the projects ranged from several hundred to several thousand percentage points, with an average annualized return rate of 998%. However, the lowest return rate for the MSN token was only 294% annualized return. This means that participating in new coin mining with high borrowing interest rates is not a guaranteed profitable strategy. Users should analyze the risks themselves.
On the other hand, according to the largest lending protocol on the TON ecosystem, @evaaprotocol, the current borrowing interest rate for TON is 72.66%. This means that there is a huge difference in the borrowing interest rates between on-chain protocols and exchanges, which may present arbitrage opportunities on both sides.
However, this protocol requires assets to be deposited first (which can be borrowed up to 65%), and there are also some transaction fees to consider during the process of lending out TON. Moreover, this protocol is relatively new and has not undergone solid verification in terms of security. Therefore, users should carefully consider the risks before borrowing.
In terms of price, possibly influenced by the Notcoin new coin mining activity, according to Coingecko data, TON has surged by 5.8% in the past 24 hours and is currently priced at $7.34.
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