---
title: "OlympusDAO (OHM)"
url: "https://caper.network/wiki/daos/stablecoins/olympusdao"
updated: 2026-09-08
license: CC-BY-4.0
license_url: "https://creativecommons.org/licenses/by/4.0/"
---

# OlympusDAO (OHM)

|  |  |
| --- | --- |
| **Name** | OlympusDAO (OHM) |
| **Type** | Reserve-currency DeFi protocol & DAO — the pioneer of protocol-owned liquidity |
| **Token** | OHM (governance-wrapped as gOHM) |
| **Launched** | March 2021, by the pseudonymous founder “Zeus” |
| **Chain** | Ethereum |
| **Governance** | On-chain, gOHM-weighted |
| **Known for** | Bonding, protocol-owned liquidity, the “(3,3)” meme, a 2021–22 boom-bust |
| **Reinvented as** | Cooler Loans, the Yield Repurchase Facility and the Emissions Manager (Range Bound Stability disabled) |
| **Links** | [olympusdao.finance](https://www.olympusdao.finance/) · [docs](https://docs.olympusdao.finance/) |

**OlympusDAO** is a DeFi protocol and [DAO](/wiki/dao-governance/concepts/fundamentals/what-is-a-dao) on Ethereum, launched in March 2021 by a pseudonymous founder known as [“Zeus”](https://www.coindesk.com/policy/2021/12/05/olympus-dao-might-be-the-future-of-money-or-it-might-be-a-ponzi). It is built around **OHM**, a free-floating token backed by an on-chain treasury rather than pegged to the dollar. Olympus's lasting contribution to the field is **protocol-owned liquidity (POL)** — the idea, now widely copied, that a protocol should _own_ the reserves and market depth that back its token instead of renting them from mercenary liquidity providers. That single design choice reshaped how DAOs think about their [treasuries](/wiki/dao-governance/concepts/treasury/dao-treasury-management) and [tokenomics](/wiki/dao-governance/concepts/treasury/dao-tokenomics); the reflexive incentive scheme wrapped around it made Olympus one of the most-studied cautionary tales in the same breath.

## Bonding and protocol-owned liquidity

Most protocols bootstrap a market for their token by _liquidity mining_: paying outside providers in freshly minted tokens to deposit into a pool. The liquidity is rented — it leaves the moment a better yield appears, and the emissions dilute holders. Olympus's answer was **bonding**: the protocol sells OHM at a small discount in exchange for [liquidity-pool tokens and reserve assets](https://docs.olympusdao.finance/main/overview/pol/) such as DAI and LUSD, and keeps them. Over time the treasury comes to _own_ the liquidity backing OHM outright, so the depth cannot walk away. Olympus later packaged this as a service (“Olympus Pro”) that let other DAOs buy their own liquidity the same way, and the bonding-plus-rebasing template spawned a wave of imitators — the “OHM forks” — across the 2021 cycle.

## (3,3), rebasing, and the boom-bust

Bonding built the treasury; **staking** was meant to keep OHM off the market. Stakers received sOHM that rebased with a very high advertised APY, and the famous **“(3,3)”** meme framed staking as the cooperative, game-theoretically dominant move — if everyone stakes and nobody sells, the price holds. Six-figure APYs and that reflexivity drove OHM into four figures and the protocol's market capitalization into the [billions during 2021](https://www.coindesk.com/policy/2021/12/05/olympus-dao-might-be-the-future-of-money-or-it-might-be-a-ponzi), prompting a very public debate over whether Olympus was “the future of money or a Ponzi.” When the incentive to stake weakened, the same reflexivity ran in reverse: OHM fell more than 90% through 2022. It is a textbook study in [how token designs that pay for their own price fail](/wiki/dao-governance/concepts/analysis/how-daos-fail) — the yield was denominated in the very token whose value it was supposed to support.

## The reinvention: Cooler Loans, and the retirement of Range Bound Stability

After the crash, Olympus kept the protocol-owned treasury and dropped the high-APY rebasing story. OHM v2 (October 2021) introduced the **gOHM** wrapper — a non-rebasing, [governance-bearing ERC-20](https://iq.wiki/wiki/olympus-dao) used for on-chain voting. The protocol then rebuilt around _backing_, not yield. **Range Bound Stability (RBS)** deployed the treasury to buy and sell OHM inside a defended price band, so the treasury itself supplied the market depth — but it is no longer running. Olympus's own documentation marks RBS [“currently disabled”](https://docs.olympusdao.finance/main/overview/range-bound) (checked 8 September 2026) and has split its two halves across separate policies: the [Yield Repurchase Facility](https://docs.olympusdao.finance/main/overview/yield-repurchase-facility/) holds the lower bound, drawing the yield the treasury earns on its USDS reserves and Cooler loans and spending it on daily OHM buybacks (authorised by OIP-163 and OIP-164), while the [Emissions Manager](https://docs.olympusdao.finance/main/overview/emissions-manager/) holds the upper one, releasing new OHM through convertible-deposit auctions only while the market price carries a governance-set premium to backing. **[Cooler Loans](https://docs.olympusdao.finance/main/overview/cooler-loans)** let gOHM holders borrow stablecoins (USDS) against the reserves backing their tokens at a fixed **0.5% APR** — perpetual, with no expiry, no external oracle and no price-based liquidation, because every gOHM is backed by USDS in the treasury. Olympus's docs call the facility “permissionless, immutable, and governed by Olympus smart contracts”; the current design is **Cooler V2**, whose rate was set by OCG Proposal 8.

## How Caper approaches this

Olympus's durable insight was that a protocol should not rent the liquidity that backs its token — it should own it. But Olympus had to _buy_ that liquidity through bonding and then defend a floating “backing per token,” and the (3,3) reflexivity turned that into a boom-bust. A [caper](/wiki/foundations/what-is-a-caper) keeps the ownership and drops the discretion. Its [bonding curve](/wiki/markets/bonding-curve) _is_ the reserve: the XRD paid on every buy accrues into the curve's own inventory vault, and any holder's exit is priced by the same closed-form integral against that vault — so exit liquidity is structural rather than incentivized, with no rented LPs, no emissions to defend, and no floating backing ratio to game. There is no six-figure APY drawing capital in and no reflexive spiral when it leaves; the reserve that lets you sell back is the reserve your purchase created. (Verified against `contracts/logic/src/lib.rs`.)

## References

- [OlympusDAO — official site](https://www.olympusdao.finance/)
- [Olympus Docs — protocol overview (OHM, POL, RBS, Cooler Loans)](https://docs.olympusdao.finance/main/overview/intro/)
- [Olympus Docs — Protocol Owned Liquidity](https://docs.olympusdao.finance/main/overview/pol/)
- [Olympus Docs — Cooler Loans](https://docs.olympusdao.finance/main/overview/cooler-loans)
- [CoinDesk (Dec 2021) — “Olympus DAO Might Be the Future of Money (or It Might Be a Ponzi)”](https://www.coindesk.com/policy/2021/12/05/olympus-dao-might-be-the-future-of-money-or-it-might-be-a-ponzi)
- [IQ.wiki — Olympus DAO (history, OHM v2 / gOHM, bonding)](https://iq.wiki/wiki/olympus-dao)
- [Olympus Docs — Range Bound Stability](https://docs.olympusdao.finance/main/overview/range-bound) — carries the “currently disabled” notice and names the two policies that replaced it.
- [Olympus Docs — Yield Repurchase Facility](https://docs.olympusdao.finance/main/overview/yield-repurchase-facility/); [Olympus Docs — Emissions Manager](https://docs.olympusdao.finance/main/overview/emissions-manager/) — the lower and upper bounds RBS used to hold.