According to a Terra blog post from 15 June, Pylon has become the fifth application to be incubated by the Terra team directly, following Chai, Mirror, Anchor, and Nebula.
Pylon Protocol’s first integrated use case on Terra will be Pylon Gateway, a token launchpad and crowdfunding-via-yield platform. The platform will offer Terra users yield-bearing fundraising options for various new applications launching on the blockchain.
Investors can deposit Terra’s algorithmic stablecoin $UST to a pool to earn project tokens, governance rights, and other designated perks. However, unlike other IDO platforms, Pylon Gateway will enable investors to withdraw their full principal after the pledged vesting period to claim project tokens and other corresponding rewards.
The initial principal deposited in $UST is fully returned and project funding is allocated through yield rather than upfront capital expenditure. This enables investors to make “no-loss,” value-additive investments that are principal-protected, Pylon explained in the announcement.
Initially, investors will only be able to deposit $UST to Pylon Gateway’s customized Pylon Pools, but other Terra-based cryptocurrencies will be added in the future. The platform is also looking into enabling other flexible funding options for projects, including dutch auctions, blind auctions, and batch auctions. Future projects might also be able to provide investors with rewards in the form of NFTs, participatory rights, or exclusive memberships.
Later versions of Pylon Gateway will also introduce instant loans that pay themselves off via future yields from investor deposits. This will support project teams that may need upfront capital for early bootstrapping.