Sablier is a token distribution protocol designed to facilitate second-by-second payments for cryptocurrencies, specifically ERC-20 tokens.
Token Distribution Use Cases
Although Sablier is a general-purpose protocol that can be used for a wide range of applications, some usage scenarios are more popular than others.
Vesting
Sablier automates the vesting process. The initial setup involves creating streams, which only needs to be done once. You simply specify the total duration of the stream (for example, two years).
In this case, recipients receive their rewards gradually over time: with each second, they receive a portion of their entitlement. This model matches the incentives of both parties. The organization only needs to spend time once to create the streams, and recipients receive funds gradually over time, allowing them to manage their finances as they see fit.
Sablier streams allow you to withdraw a portion of your funds at any time.
With Sablier's stream interface, anyone can keep track of all streams created at a particular address, as well as all transactions associated with each stream.
Airdrops
Instead of airdropping the entire volume of tokens at once, airdrop recipients receive a portion of tokens every second via the Sablier stream.
Thus, airdrop recipients are forced to think about the long-term development of the project and continue to participate.
The price of tokens can fluctuate over time, which motivates recipients to do their best to increase the price. In cases where a recipient does not continue to participate in the project, the airdrop creator has the option to cancel the recipient's stream. Canceling the flow will not cancel tokens already spent, but will prevent the recipient from getting more tokens.
Payroll
Streaming salaries through Sablier can significantly improve employee satisfaction and retention.
Grants
Grants is a powerful use case for Sablier that allows for efficient, transparent and flexible distribution of funds to grantees.
Sablier provides real-time streaming of funds, ensuring transparency in the distribution of grants. Your stakeholders can monitor the flow of funds, providing assurance that money is being used for its intended purpose.
How Stream works
Sablier co-founder Paul Berg published ERC-1620 in November 2018, proposing a standard for streaming payments on the Ethereum blockchain. The standard required users to lock a certain amount of funds into a smart contract, which would then be issued to the recipient at a predetermined rate per second.
Sablier was born in 2019 when Paul and his co-founder Gabriel Apostu decided to create a protocol that implements the ERC-1620 standard.
Streaming involves a much lower degree of trust than lump-sum payments because it eliminates the need for advance payments.
Streaming transactions are more secure than lump-sum payments because they allow you to correct errors.
Suppose you accidentally run a 10 ETH pair to the wrong address. For example, if you accidentally run a stream of 10 ETH to the wrong address, you can cancel the stream and get back your untransacted Ethers (e.g., refund 9.99 out of 10 ETH). Conversely, it is not possible to refund a one-time payment sent to the wrong address, unless the recipient wants it back.
There is no one-size-fits-all streaming model that can satisfy all the different usage scenarios, so Sablier has developed different options.
Stream types
- "Lockup" is a higher-level category that denotes a requirement that the creator of a stream must lock a certain number of assets in a smart contract. All streams currently supported by Sablier are Lockup flows.
- Lockup Linear. The number of streams over time follows a straight line that goes up and to the right on the graph, which corresponds to the identity function f(x)=x. With this type of flow, the payout rate remains constant, meaning that the same portion of the deposit amount is transferred to the recipient every second. This provides greater predictability.
- Cliffs. A "cliff" can be attached to a Lockup Linear stream, which sets a cutoff point for releasing assets. Before the cliff, the recipient can't withdraw assets, but the stream continues to accumulate them. After the cliff, a constant payout rate per second takes effect. This feature is particularly useful for ERC-20 tokens vesting as it allows, for example, to have a cliff of 1 year and then another 3 years of linear flow.
Lockup's dynamic streams are what make Sablier so unique, as they allow you to create any type of streaming curve, including non-linear ones.
Sablier interface supports some forms of distribution (those listed below), but the potential for innovation is limitless when interacting with contracts programmatically.
- Exponential streams are a form in which the recipient receives more and more tokens over time. Exponential streams are great if you want to distribute tokens via airdrop, as your community members will receive most of the tokens by the end of the stream.
- Cliff exponential stream starts with a cliff (which can be as long as you want), a certain amount is instantly unlocked when the cliff ends, and then the rest of the stream goes exponentially. This is a great distribution if you're a company looking to create a token vesting plan for your employees. Your employees will have an incentive to stay with your company in the long run as they receive more and more tokens.
Other types of curves such as Timelock, Unlock Linear, Unlock Cliff, Lockup Tranched, Unlock in Steps are a combination of the above.
NFTs
The Sablier protocol wraps each stream into an ERC-721 non-fungible token (NFT), making the recipient of the stream the owner of the NFT. The recipient can transfer the NFT to another address, and this also transfers the right to withdraw funds from the stream, including any funds already withdrawn.
The ability to transfer NFTs makes Sablier streams suitable for trading and use as collateral in DeFi.
Not all Sablier streams are transferable. The creator of a stream may choose to make the stream non-transferable.
Due to ERC-721 compliance, Sablier streams can be traded and viewed on any NFT marketplace.
Sablier V2 streams are represented as unique SVG hourglasses generated on the chain that change their color and content based on user data.
When creating SVG images , certain real-time values are used, such as the current time on the blockchain. However, NFT trading platforms cache NFT metadata, which may cause SVGs to not always be up-to-date.
The Sablier protocol triggers ERC-4906 events whenever a stream is updated (e.g., when withdrawing funds). However, it's worth noting that some streams may remain unchanged for long periods of time.
To ensure that you are viewing the most recent version of the NFT SVG, it is recommended that you check the stream directly through the Sablier interface.
