The vote-escrowed model was first introduced by Curve Finance, a DEX that specializes in low slippage high-volume trading of pegged assets. The model involves locking tokens for a period of up to four years in exchange for boosted governance and rewards on the platform.
Typically, the native token (e.g. $CRV) is the one that is locked and then converted into the vote-escrowed form (e.g. veCRV)– the governance token.
By locking their tokens, holders gain the right to vote on decisions and control where emissions are directed – the longer the governance token is locked, the more voting power holders receive.
Being able to direct token emissions towards a pool means that holders have the power to choose where liquidity providers of such pools will receive greater rewards and thus attract more liquidity.
The Ve token is usually used to earn platform fees, vote on governance, receive boosted pool rewards, and acquire possible bribes. veDPX will bear a close resemblance to this model but with some minor tweaks.
Dopex’s native token ($DPX) will need to be locked for a certain period of time to receive the governance token (veDPX). This new governance enables users to participate in voting. Voting power will be central to the functionality of the Dopex platform since it dictates gauge weights to pools which itself dictates the number of emissions those pools receive.
These emissions (paid in $DPX) will most likely control the flow of liquidity into the protocol. Pools that receive a large vote allocation (and thus have a high gauge weight) can expect more liquidity since liquidity providers (LPs) will want to earn the higher emissions. In the same way that Curve does this to generate deeper liquidity for certain pools, Dopex aims to use this model to generate deeper liquidity for specific SSOVs.
Specific to Dopex, veDPX holders can also vote on strikes for our SSOV options, strikes for IRO options, V2 parameters, and more.
It will be possible to lock $DPX for up to 4 years with lockers receiving veDPX corresponding to the duration of the lock - the longer the lock, the more veDPX you receive. Since veDPX is the governance token, those that lock for longer will have more control over liquidity distribution on Dopex. In addition to this, veDPX provides holders with platform fees and boosted pool rewards. Similarly to veCRV, the amount of veDPX a user has will decay over time as an unlock approaches to ensure that holders with a long-term investment in Dopex have a greater say in governance.
Ve-Lock: $DPX holders will be able to lock their tokens for up to 207 Weeks (~4 Years) in exchange for veDPX. Locking tokens will be done easily and straightforwardly using a slider for users to choose their preferred “locking” duration. The locking UI will be on a specific page on the Dopex website, link: https://app.dopex.io/governance/vedpx
Note that after locking, your veDPX:
- is non-transferable and cannot be redeemed for $DPX until the lock duration ends
- the supply of veDPX in your wallet will decrease as the unlock period approaches
- can be used for governance voting, platform rewards, etc.
The longer you lock your $DPX, the more veDPX voting power you will receive with the corresponding distribution outlined below:
- 1 $DPX locked for 4 years = 1 veDPX
- 1 $DPX locked for 3 years = 0.75 veDPX
- 1 $DPX locked for 2 years = 0.5 veDPX
- 1 $DPX locked for 1 years = 0.25 veDPX
Everyone locking $DPX is rewarded with:
- 10k DPX split among all veDPX stakers throughout the 1st year
For the moment, Until other utilities are slowly rolled out, veDPX stakers will be able to:
- Receive yield from protocol fees and from $DPX rewards
- Holders with >1k veDPX (1k dpx staked for 4 years) can arbitrage the dpxETH pool And more synths to come.
- Lending rates on lending vaults
- Deciding rDPX V2 Parameters
- Deciding on new IRO vaults
- Deciding on new SSOV vaults
- Deciding on future incentives for all our products
- Voting on strikes for call pools
- Voting on strikes for put pools
- Voting on Gauge weights to decide on emissions
- Voting on Interest Rate Options strikes
- Voting on governance proposals