OHM is an ERC-20 token on Ethereum, powering the Olympus DAO, a decentralized reserve currency protocol. OHM is not tied to a fiat currency and instead functions as a free-floating "flatcoin," using the Range Bound Stability (RBS) system to maintain a transparent and programmatically enforced price range. Olympus rewards stakers with compounding interest, increasing their OHM holdings over time. ^[1][2]

Overview

OHM was introduced by Olympus DAO as an alternative to both cryptocurrencies and stablecoins. Unlike stablecoins, the value of OHM is not pegged to another currency. It is backed by 1 DAI in the treasury. It is designed to bridge the gap between fiat-pegged stablecoins and highly volatile cryptocurrencies, offering relative price stability and scalability through an autonomous, on-chain mechanism. Founded by a pseudonymous, Zeus, it outlined a strategic vision for Olympus, positioning it as a community-driven DAO with an active and engaged user base. Olympus continues to evolve, with key updates such as the migration to Olympus V2, which introduces on-chain governance and expands the protocol across additional blockchain networks. ^{[1] [9]}

OHM was launched in March 2021 through a Discord offering and an Initial Decentralized Exchange (DEX) Offering (IDO). Users that joined the Discord early enough were able to purchase 141 OHM for a price of $4 per OHM. As many as 50,000 OHM were given out, and an additional 18,260 tokens were given through the IDO on SushiSwap. Within a month of this release, the token hit an all-time high of nearly $1, 500. This level meant that the initial investment of $564 in the Discord was worth over $200,000 in less than a month.

Numerous venture capital firms invested in the project, including D64 ventures and Zee Prime capital. These firms are also investors in projects such as Solana and Polkadot. ^[3]

V2 Migration

The migration to OHM V2 introduced several enhancements, including on-chain governance and auto-staking for bonds, providing users with improved functionality and flexibility. Transitioning from sOHM V1 to gOHM enables features such as multiple bond acquisitions during a single vesting period, compared to the one-bond limitation in V

1. Partial liquidity for OHM V1 remains available during the migration to ensure borrowers can manage or transition their positions. The migration replaces wsOHM V1 (wrapped, staked OHM) with gOHM (Governance OHM), designed to support on-chain governance. Although gOHM balances appear different due to its pricing structure (based on the Current Index), the dollar value remains consistent.

OHM and sOHM tokens also receive direct V2 counterparts, with OHM V1 becoming OHM V2 and sOHM V1 transitioning to sOHM V 2. Post-migration, V2 tokens, such as OHM V2, are required for new bonds, liquidity pools, and partner integrations like Abracadabra. Users can migrate at their convenience but will need to do so to access V2-exclusive features. ^[7]

gOHM Token

gOHM (Governance OHM) is an ERC-20 token utilized for governance within the Olympus protocol. It is required for proposing upgrades and participating in protocol decision-making. gOHM can be acquired by wrapping OHM and can also be unwrapped back into OHM. Current applications of gOHM include governance voting and serving as collateral for obtaining Cooler Loans. ^[8]

Technology

OHM is backed by Dai tokens in a 1:1 ratio. For each OHM token, there is a DAI token held in the treasury. Tokens can't be minted or burned by anyone except the protocol. The protocol only does so in response to price. When OHM trades below 1 DAI, the protocol buys back and burns OHM; when OHM trades above 1 DAI, the protocol mints and sells new OHM. Because the treasury must hold 1 DAI and only 1 DAI for each OHM, every time it buys or sells it makes a profit. It either gets more than 1 DAI for the sale or spent less than 1 DAI on the purchase.

OHM token does not rebase. New supply is created via direct sales into the market and burned via direct purchases from the market. This way, OHM remains backed by real assets in the treasury.

OHM is minted and distributed for staking rewards. More OHM staked reduces the APY but pushes the OHM price higher, creating a balance that protects a user's investment.

Features

OHM Staking

Staking is the primary value accrual strategy of Olympus DAO. Stakers stake their OHM on to earn rebase rewards. The rebase rewards come from the proceed from bond sales, and can vary based on the number of OHM staked in the protocol and the reward rate set by monetary policy.

The Olympus staking system allows the platform to provide compounding returns automatically. They do this with sOHM, a secondary token that represents staked OHM. sOHM can always be exchanged 1:1 for OHM, but it rebases to reflect profits. ^[4][2]

OHM Bonding

Bonding is the secondary value accrual strategy of Olympus. It allows Olympus DAO to acquire its own liquidity and other reserve assets such as LUSD by selling OHM at a discount in exchange for these assets. The protocol quotes the bonder with terms such as the bond price, the amount of OHM tokens entitled to the bonder, and the vesting term. The bonder can claim some of the rewards (OHM tokens) as they vest, and at the end of the vesting term, the full amount will be claimable. ^[5]

Hypernative Partnership

In March 2024, Olympus DAO renewed its partnership with Hypernative to enhance security through real-time monitoring and proactive threat prevention. The expanded collaboration included front-end monitoring, security advisory services, and advanced custom monitoring capabilities to address the evolving risks associated with the protocol.

Olympus DAO oversees a large-scale decentralized finance ecosystem with over 120,000 token holders, a treasury valued at more than $189 million, and a market capitalization exceeding $198 million. Leveraging Hypernative's platform, Olympus aims to strengthen its defenses against various attack vectors and safeguard its treasury-backed OHM token. ^[11]

2022 Hacking Incident

In October 2022, OlympusDAO experienced a security breach in which an attacker exploited a vulnerability in the BondFixedExpiryTeller smart contract, withdrawing approximately 30,000 OHM tokens valued at $300, 000. The contract, developed by Bond Protocol and used during a pilot launch of OHM bonds, was not part of OlympusDAO's native smart contracts. Despite undergoing audits and reviews, the bug had gone undetected.

The OlympusDAO team quickly reassured the community, noting that the exploit affected only a limited amount of funds due to a phased rollout, and all other funds remained secure. Hours after the incident, the attacker returned the stolen funds to the DAO wallet. While the motives of the attacker remain unclear, the swift return suggests either a change of heart or an intentional "white hat" operation. ^[10]