📈veDEX
Introducing some important terms and definitions
ve(3,3)
Ve stands for 'vote escrowed' - tokens are locked up for a certain period to gain voting rights on the protocol. (3,3): Represents a game theory concept where all participants benefit if they lock their tokens (stake) in the long term.
Key aspects of the ve(3,3) DEX
Alignment of Interests: Aims to create a system where both the users providing liquidity, the voters, and the overall protocol itself all benefit from the DEX's success.
Voting Rights: Locking SWAPA grants voting rights on various aspects of the DEX, such as swap fees, bribes (incentives for liquidity providers), and even the distribution of new tokens
Long-Term Focus
By locking SWAPA by converting to xSWAPA, users are incentivized to think strategically about the DEX's health and avoid short-term actions that might harm it. By rewarding xSWAPA holders (voters) in the form of bribes, emissions and fees, users are incentivized to participate in the DEX's governance and long term growth
Advantages
Potentially deeper liquidity compared to traditional DEX models.
More control over the DEX's direction by the community.
Fairer distribution of fees and emissions.
More efficient and decentralized staking through the form of bribes.
More capital efficient, attracting more liquidity with less overall token supply.
Circulating supply is more important in ve(3,3) as a large a portion of SWAPA will be naturally locked to receive fees from LPs + bribes from protocols to direct emissions to their pool each week
Last updated