منذ 14 ساعة
Lockonomics, or: How I Learned to Stop Worrying and Love the Dromes
I got tired of explaining why @AerodromeFi @VelodromeFi were not ponzis but actually a brilliant superior model for accruing liquidity and rewarding long-term holders.
So I wrote an article (link below)
The full article:
1) Here's how a basic DEX like Uniswap works — LPs get fees + incentives provided out of protocol by projects. The project token serves no role besides governance (RIP $UNI holders).
2) On the other hand, here's how the dromes work. LPs get the project token, in a quantity that is determined by project token lockers. Lockers get fees + "bribes" (3rd party project incentives) for the pools they vote to allocate tokens to.
3) If project token emissions are exactly equal to fees + bribes, this model is equivalent to the basic model.
But lockers still make money!
4) That's because the token supply gets inflated, but only lockers get rewards. So as long as < 100% of the supply is locked, lockers are making money.
In the dromes model, there is an inherent speculation tax on short-term holders (who get inflated) in favour of lockers.
5) In practice, the dromes have about 50% of their supply locked long-term. This means that the net (post-inflation) yield is half of what you see on the frontend.
6) Remember, this assumes:
1. market cap is constant
2. emissions = revenue (fees + bribes)
Both can be false in practice.
7) First, the market cap is volatile, but hasn't been dropping in pace with inflation as a general trend. This makes total sense, because protocol revenue has been growing!
8) Second, the big kicker: emissions are higher than revenue. It's a ponzi!!!! 😡
No, it's not.
9) Why it's not a ponzi.
The protocol is balanced when emissions = revenue.
And the protocol can set the rate of emission (right now permissioned, will become permissionless later). So it can always be brought back to equilibrium.
10) Why emissions > revenue?
To grow the protocol!
Higher APY attracts LPs, higher liquidity attracts volume, hence more fees.
This also incentivizes projects to use dromes for liquidity, as 1$ spent in bribes causes > 1$ in rewards to LPs, attracting more liquidity.
11) First, note that in the last few epochs, emissions < revenue!
But emissions > revenue did work well, as Aerodrome has consistently grown in revenue and volume. Velodrome's metrics regressed a bit, but it outperformed on the Superchain ex-Base.
12) It's also notable that when emissions > revenue, lockers have been more than fully compensated for the emissions (i.e. the net APY post-dilution is positive).
13) Why lock?
Locking effectively takes tokens out of circulation long-term, reducing sell pressure. This allows upside if the token trades on flow, and prevents people from selling with the market without taking a haircut.
14) Note however that at > 30% net (post-dilution) yield *right now* on Aerodrome, locked tokens effectively have a P/E ratio of 3.33... (Apple: 38, Nvidia: 51)
It's basically the cheapest thing in DeFi, with the big caveat that you have to lock long-term.
15) So in summary:
- If emissions = revenue, the dromes work just like Uniswap.
- ... but lockers still make money on net because the non-lockers are being diluted with no compensation.
- Emission control can always bring the protocol back to emissions = revenue.
- It's rational to have emissions > revenue if this grows the protocol, ensuring higher levels of future fees.
- Locking long-term reduces sell pressure.
16) I think the dromes model — aka "ve(3,3)" or "MetaDEX" — is brilliant, and I think it could be applied to other revenue-generating projects.
I'm coining the term "lockonomics" for projects that follow this basic recipe:
- Distribute yield via project token emission.
- Distribute revenue to long-term project token lockers
- ... ensuring net yield to lockers via short-term holders dilution.
Letting lockers direct emissions is optional and doesn't work with every protocol, but is interesting because it can incentivize certain actors (e.g. projects with a token) to accumulate locked tokens.
17 / END) Read the whole article for a much deeper explanation, extra details, and fun anecdotes:
@BautiDeFi @AerodromeFi @VelodromeFi Also shout out to you for being one of the persons I talked to that caused me to write this post, and specifically our conversation caused me to pull the trigger! Appreciate the good open-minded debate!
11.52 ألف
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المحتوى الوارد في هذه الصفحة مُقدَّم من أطراف ثالثة. وما لم يُذكَر خلاف ذلك، فإن OKX ليست مُؤلِّفة المقالة (المقالات) المذكورة ولا تُطالِب بأي حقوق نشر وتأليف للمواد. المحتوى مٌقدَّم لأغراض إعلامية ولا يُمثِّل آراء OKX، وليس الغرض منه أن يكون تأييدًا من أي نوع، ولا يجب اعتباره مشورة استثمارية أو التماسًا لشراء الأصول الرقمية أو بيعها. إلى الحد الذي يُستخدَم فيه الذكاء الاصطناعي التوليدي لتقديم مُلخصَّات أو معلومات أخرى، قد يكون هذا المحتوى الناتج عن الذكاء الاصطناعي غير دقيق أو غير مُتسِق. من فضلك اقرأ المقالة ذات الصِلة بهذا الشأن لمزيدٍ من التفاصيل والمعلومات. OKX ليست مسؤولة عن المحتوى الوارد في مواقع الأطراف الثالثة. والاحتفاظ بالأصول الرقمية، بما في ذلك العملات المستقرة ورموز NFT، فيه درجة عالية من المخاطر وهو عُرضة للتقلُّب الشديد. وعليك التفكير جيِّدًا فيما إذا كان تداوُل الأصول الرقمية أو الاحتفاظ بها مناسبًا لك في ظل ظروفك المالية.