Bumper SitRep #039 February 2025
We want to provide a transparent update on recent protocol challenges and the steps we’re taking to address them. The primary issue stems from an imbalance between Takers and Makers, which has impacted pool stability.
Current Status
- The protocol has functioned as designed, but a shortage of active Makers led to unintended stress on the pool.
- The imbalance caused premium spikes, negatively affecting Takers.
- This was caused by large claims against the WSTETH market late in 2024 that reduced the available capital pool, forcing higher premiums to compensate.
- Due to the early-stage growth phase, the pool has yet to reach a “steady state” where liquidity dynamically balances with less extreme pricing changes.
- For now we have paused the WSTETH Taker pool, and are in contact with the users who were negatively impacted.
- The WBTC Taker pool was unaffected and remains open.
Impact on Users
For Takers (Hedgers)
- Higher Premiums: Premiums temporarily skyrocketed in response to low Maker participation, causing the platform to adjust premiums to essentially incentivise more Makers.
- Temporary Measures: Premium adjustment fixes were manually implemented.
- Next Steps: We have been assessing affected accounts and will reimburse excessive premiums where appropriate. Please reach out to support@bumper.fi if you were one of the wallets affected and haven’t had a resolution.
For Makers (Liquidity Providers)
- Negative Yields: A lack of consistent liquidity growth in the pool resulted in high claim payouts, leading to unsustainable negative returns for Makers.
- Paused Deposits: The WSTETH market for Takers has been paused until a liquidity solution is finalised.
- Next Steps: The team is investigating sustainable fixes to attract new liquidity.
Recent Actions Taken
✅ Premium Adjustments — We introduced parameter changes to ease premium spikes to support withdrawals from the WSTETH Taker pool without loss.
✅ USDT Symbol Fix — Resolved an issue caused by Arbitrum updating USDT to USDT0, which briefly disrupted the platform.
✅ Protocol Assessment — The team is conducting a full review to ensure these issues don’t reoccur, which is focused on how to maintain a sustainable Maker liquidity pool size.
✅ Re-imbursement — For those few people affected, we are working through their issues and looking to re-imburse where appropriate.
Next Steps
🔹 Maker Recruitment — We are open to exploring incentives to attract new Maker liquidity providers for both WBTC and WSTETH when we re-open it.
🔹 Earn Pool Visibility — To attract new Maker liquidity providers, we will work on public-facing stats for better transparency.
🔹 Protocol Improvements — We will be reviewing deeper infrastructure changes to strengthen long-term pool stability.
The Bigger Picture
We are in the middle of a bull run, a time when traders are chasing opportunities, speculating on fast-moving assets, and seeking outsized returns.
As attractive as hedging against volatility is, we haven’t yet carved out a strong foothold in the market in terms of attracting Makers to provide liquidity or incentivising users to bond their wrapped ETH or BTC in the Taker pools.
Bull runs are about momentum and risk-taking, whereas hedging often becomes a priority when the tides turn. The challenge we face is not in the strength of the technology, but in finding our market fit at the right time.
We are evaluating the best path forward — whether it means refining the protocol to better align with market conditions or positioning ourselves to thrive in future cycles.
We appreciate your patience as we assess these realities and determine the best course of action. Your feedback and engagement remain invaluable as we work towards solutions.
Stay tuned for further updates, and thank you for being part of the Bumper community. 🚗
Best,
The Bumper Team
About Bumper
Bumper protects the value of your crypto using a radically innovative DeFi protocol. Set the price you want to protect and if the market crashes, your asset will never fall below that price. Importantly, if the market pumps, your asset rises too.
Stay Connected to Bumper:
Join our Discord — https://discord.gg/YyzRws4Ujd
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Visit our Website — https://bumper.fi
