Update on Clip Finance’s Acquisition Discussions
We would like to update our community regarding a significant development in Clip Finance’s journey. Over the past two months, our team engaged in advanced negotiations with a leading cross-chain interoperability project. A term sheet was signed, and both parties planned to finalize an acquisition by the middle of February. Unfortunately, late last week, the acquiring company withdrew from the deal, citing a mismatch in team cultural fit and lack of domain knowledge.
During January, Clip Finance’s core contributors worked extensively for the acquiring party — sharing our in-depth knowledge of decentralized solver pools and interconnected liquidity networks (intent based cross-chain bridging). We suspect they may now opt to build their own solution in-house, choosing a longer development timeline rather than integrating ours.
Clip Finance: A Brief History
Clip Finance’s journey started 2 years ago by offering automated yield solutions in a 1-click style deposit where Clip as a platform is re-allocating to best-performing yield strategies. We called it Strategy Router. We realized in DeFi people want to control their funds and this product was not getting traction so we quickly pivoted to adding various strategies for stablecoins, Ethereum, wrapped bitcoin, and concentrated liquidity strategies. We started getting traction and deposits coming in, but realized strong competition and adding a new strategy requires the development of a new smart contract auditing it, and then somebody else can simply copy it. We even copied other smart contract strategies and got more TVL than the original protocol simply due to better UX and marketing. We understood that simply adding new strategies would not get us far. Meanwhile, crypto liquidity was getting more fragmented, as we believe in the multichain future we started seeing app chains popping up.
This led us to develop a solutions that connects blockchains with intent based architecture and solvers models. We call it decentralized solver pools and interconnected liquidity network where using different chains feels almost same as using 1 chain and any new chain has a self-serving kiosk to connect to liquidity network and get access to all the liquidity with blazing fast speed of 2 seconds bridge time.
Why We Entered Acquisition Talks
With limited treasury resources, competing against well-funded bridging solutions posed a serious challenge. We believed joining forces with a larger, more established cross-chain platform would be the most efficient way to maximize value for our stakeholders — leveraging our solver technology under a bigger umbrella rather than depleting our own treasury in an uphill battle. We signed a term sheet in good faith, envisioning a unified effort to advance interoperability across DeFi.
However, the intended acquirer chose to withdraw from the agreement just weeks before our integration was set to conclude.
What happens next with Clip Finance?
All existing Clip Finance strategies will remain operational, with withdrawal options available for users. However, we will not introduce any new strategies.
Clip Finance has built blazing fast cross-chain interoperability solution and is looking for potential acquirers or partnerships. Bigger technical documentation will come out soon.
Clip Finance bridge solution is
- Scalable: chain-agnostic modular bridge system which allows adding new chains with specific features without significant modifications of the execution flow
- Has great user experience: as affordable and as fast as the current industry leading competitors. Stable execution.
- Has efficient liquidity management: have money in most liquidity demanding chains available at all times to deliver user transactions
Bridge solution has following components:
Portal — administrative management system
- Ability to manage existing chain configurations etc.
- Allows easily add new chains to the system (no redeploys for EVMs)
Quoting system — provides quotes considering our inventory management cost
- How much do we take for the bridge?
- Bridge fee must include the cost of rebalance
Agents Layer — protective layer to ensure stability and eliminate blockchain node inconsistency
- Monitors incoming transactions
- Handles reorgs
Relay — transaction fulfillment system
- Fills intents
- Handles stuck transactions
- Issues refunds
Inventory management — liquidity efficiency system
- Goal is to keep money in productive places
- Rebalance
- Native bridges
Intent receiver — chain specific system
- Accepts funds and intents on every blockchain
What about the CLIP Token?
Per Clip Finance unique TVL-based tokenomics we have vested 2 milestones (reached $2m TVL) out of 59. This means CLIP token holders have unlocked around 0.6% from their allocation and that also includes TVL providers — ones who have deposited into Clip Finance strategies. Because no more TVL growth is expected therefore no more CLIP token unlocks.
For CLIP token holders we have 2 options — cash out; invest under same terms into Clip founders new project.
An additional rule for token holders who were participating in YourFriendSommi StationX syndicate or who had SAFT agreement signed will have the remaining 99.4% of CLIP tokens unlocked and can burn them for options outlined below. Working token holders like advisors, TVL providers and any other holders have from their allocation 0.6% vested according to our tokenomics. Clip has around $270,000 in the treasury that will be distributed and token holders would receive around 25 cents on the dollar.
Option 1 — cash out at the rate of roughly around 30cents on the dollar. You would recoup ~25% of the value of the token that you had to receive it. We will provide a mechanism where any token holder can burn tokens back into USDC.
Option 2 — invest into a new project by Clip founders Unigox.com. You would get the same allocation as in Clip. Clip founders won a prize in the biggest crypto hackathon and are going to be part of the next accelerator to build an automated fiat p2p on and off-ramp by solving problems of scams, high prices and making trades completely automated without a peer to peer chat. Accelerator believed in the founders and having experience from the past building p2p crypto marketplace.
Acknowledgements
We extend our heartfelt gratitude to our partners — especially Linea, whose unwavering support has been instrumental in our growth.
A message from the Clip Finance team
Though the acquisition did not come to fruition, our commitment to pushing crypto adoption to the masses remains unwavering. We will continue to refine our technology, engage in strategic partnerships, and explore new opportunities to innovate in decentralized finance.
We appreciate your understanding and support during this time. The Clip Finance community has always been a driving force in our evolution, and we remain focused on delivering value to all stakeholders.
With gratitude,
The Clip Finance Team
For future updates and community discussions, please stay tuned to our official channels.
