[RFC-30] POP Tokenomics 2.0


This RFC is an outline of how I envision we optimize the POP tokenomics based on research I’ve been doing on the DeFi market, specifically on protocols using creative veToken models, or vote-escrow tokens. Some useful resources I used also include the following articles:

  1. Power Tokens — A new Tokenomics Template [Part 1] | by 0xKepler | Deus Ex DAO | Medium

POP Tokenomics 2.0

  • Stake POP for vePOP
    • Choose lock time
    • Loyalty Boost rewards
  • The higher your vePOP balance, the higher the yield for POP staking and vault LP’s
  • Unlock vePOP at any time but with a penalty
    • Burn all accrued vePOP tokens (Platypus)
    • Or burn depending on time unstaked ie 50% burned if unstaked after 1 year when locked for 2 years
  • vePOP accumulates protocol revenue

POP → VC Token general idea:

  • Burn POP for VC token for the remainder of 2023, incentivizing the following
    • Market orders for POP
    • Liquidity Mining POP
    • Burning POP, which should also theoretically appreciate POP value due to increased scarcity, benefiting all stakeholders
  • VC Token governs VaultCraft
    • Tokenomics TBD
  • Rollout:
    • Inform people VaultCraft will have its own governance starting in 2024
    • POP will be required to burn for VC token
    • GTM:
      • POP Liquidity Mining starts May 1st, 2023
        • All miners will be White Listed for VaultCraft in 2024 pro-rata
        • In order to mine, you will need to stake POP to mine POP with vaults, meaning you will need POP staked to be eligible for APY boost in POP with vaults
      • Burning starts September 1, 2023
        • With weekly burns until 2024

POP Goals:

  • Long-term alignment between all stakeholders
  • Accumulate community members
  • Increase governance activity
  • Appreciation to benefit all stakeholders


Alternative Strategies

  • Soft lock-ins - locked staking does not buy loyalty and the word on the street is that it left POP stakers dissatisfied
  • Theoretically, adds opportunity cost for stakers with the goal of reducing short-terms fluctuations and inspires people to think long-term

1. Time-based mechanics:

  • Stakers accumulate loyalty boosts which award them more rewards/governance right over time

  • Unstaking is allowed anytime, but boost is lost once unstaked

  • Opportunity cost = loss of future revenue & vote weight

  • Additional mechanics can be added to disincentivize unstaking:

    • Unstaking penalty/Rage Quit
      • Burn all accrued veTokens (Platypus)
      • Burn multiplier points (GMX, partial penalty)
      • Unstaking windows, 21 days (Prism)
    • Reward Vesting - protocols like GMX (esGMX), stakers don’t earn native token, but an escrowed token instead, and they can decide to:
      • Keep esGMX for 1 year, automatically staked and earns rewards (autocompounder), more rele
      • Vest esGMX, but no rewards are earned (vestor)
    • Stakers have to choose between vesting or earning protocol revenue with esGMX
  1. Power Token
  • LP’s rewards when claimed are directly converted into Power Tokens
  • This should naturally limit the float of circulation, allowing more gradual sell pressure from emissions
  • Multiplier
    • A user’s individual multiplier is a function of the number of Power Tokens delegated and the $ amount they’ve LP’d
    • The multiplier sits on a logarithmic curve
      • Beginning of curve has steeper slope allowing user to attain higher multiples while preservice high capital efficiency
      • The more tokens, the flatter the curve, making it costlier and less capital efficient for LPs to power up
  • Redeeming Power Tokens for the underlying tokens is only possible when the Power Tokens are not currently being used in other modules, ie
    • Liquidity mining
    • Governance
    • Additional modules
  • This ensures that tokens can not be “double spent” or “double used.”

Super interesting and exciting RFC.
Pop’s tokenomics are due for revision and now is the perfect time.
I see a really interesting gamification play: retain POP for share of protocol earnings or burn for VC token.
Strongly support increased staking rewards proportionate to locking time committed = reward for long term lockup, coupled with penalty for early exit.

@krychek :

  • Interested to hear more about this on upcoming Twitter spaces?
  • what aspects of the proposed tokenomics are new/unique compared to other protocols?

Love it!


Nice RFC
This ideas will definitely make POP good on the market

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Thiese RFC are dome really interesting guidelines derauled out and i believe it will work out just as ut is envisioned. I would have liked more details on the vite-escrow tokens by the way

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The team’s commitment to community moderation and engagement, as well as the ongoing efforts to execute timely contributor payments, is admirable. I’m looking forward to seeing the continued progress of PopcornDAO in the coming months.

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Nice RFC
This ideas will definitely make POP good on the market. Cheers to the Team.

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The team’s commitment to community moderation and engagement, as well as the ongoing efforts to execute timely contributor payments, is admirable. This is a very nice step. I am looking forward to seeing the continued progress of PopcornDAO.