Tokenomics
Equilibria is driven by a steadfast commitment to sustainability, community empowerment, and long-term success. With a strong emphasis on creating a decentralized finance platform that prioritizes the needs of its users, Equilibria's tokenomics is designed to foster long-term growth and engagement.
By allocating tokens in a way that encourages active participation and aligning incentives with the project's sustainability goals, Equilibria ensures that the community remains at the heart of decision-making processes. Through community-driven initiatives and a carefully structured vesting schedule, Equilibria empowers its stakeholders to actively contribute to the protocol's development, creating an ecosystem that thrives on the principles of decentralization and inclusivity.
Principles
With a total supply of 100,000,000 tokens, Equilibria's token allocation and vesting schedule offer a fair and balanced distribution, ensuring the alignment of incentives among all stakeholders. We have done our best to uphold the following principles when designing the tokenomics:
Autonomy
EQB tokens will be distributed over multiple years according to a carefully thought-out curve to promote long-term TVL growth for both Equilibria and Pendle, through the accumulation of voting power. This will increase the utility of vlEQB as a governance token.
Decentralization
To create a community-first approach for EQB, the majority of tokens will be distributed to the community, with only a small amount allocated to venture capitalists to cover initial costs. This will promote decentralization and ensure that the community has a significant stake in the governance of EQB.
Early Adoption Bonus
We believe in rewarding early supporters and active governance participants who lock and utilize EQB tokens in governance. The goal is to create a culture of long-term alignment by incentivizing community members to lock EQB into vlEQB, thereby increasing their voting power.
Performance-Driven
The token distribution for core contributors is designed to align their incentives with the success of Equilibria. Under this model, the amount of tokens that contributors receive is tied to the protocol's performance, measured by the total amount of PENDLE earned on Equilibria. As this metric increases, so does the amount of token emission for contributors. This way, we can ensure that contributors remain fully engaged and focused on delivering the best possible outcomes for the protocol and its community.
Distribution
Community
Airdrop (2% of total supply):
Up to 2% of the total token supply will be distributed through airdrops. Details will become available over time.
Bootstrapping Incentives(2% of total supply):
To bootstrap the whole platform and incentivize the early participants of PENDLE to join Equilibria, we offer attractive rewards. Users have the option to claim rewards directly to their wallets, subject to a 40% penalty, or choose to lock their tokens for more than six months to receive the full amount. This mechanism ensures active participation and enhances the stability of the ecosystem. This allocation constitutes 2% of the total token supply.
Pendle LP Incentives(45% of total supply):
Equilibria rewards users who stake Pendle LP tokens on our platform. The emissions will be distributed pro rata based on the amount of PENDLE received. This allocation, accounting for 45% of the total token supply, follows a deflation model, ensuring a sustainable emission mechanism that aligns with the growth of the protocol. The initial emission will be comprised of 25% EQB and 75% xEQB.
For every 1,000,000 EQB tokens minted, a deflation factor of 0.95 is applied, effectively reducing the total supply.
Liquidity Mining(10% of total supply):
To promote liquidity and provide incentives for users, Equilibria will allocate 10% of the total token supply for liquidity mining such as EQB, ePENDLE liquidity. The rewards will be emitted on a weekly basis, with a deflation rate of 1.1%. The emitted tokens will be securely stored in a multi-signature (multi-sig) wallet, ensuring a transparent and accountable approach to their management. Decisions on how to utilize these tokens will be made collectively by the Equilibria community. This approach encourages active participation and ensures the availability of liquidity within the ecosystem.
Equilibria Treasury(14.5% of Total supply):
The Equilibria Treasury plays a vital role in community-driven initiatives and the long-term sustainability of the protocol. It consists of protocol-owned liquidity that can be used to receive future investment, develop strategic partnerships with other protocols, etc.
Initially, only 30% of the treasury will be unlocked, followed by linear vesting over a two-year period. This allocation constitutes 14.5% of the total token supply, providing the community with resources to support and enhance the ecosystem.
Others
Team/Advisors(16.5% of the Total Supply):
Equilibria recognizes the valuable contributions of its team and advisors. To align their incentives with the project's success, this allocation follows an innovative Performance Driven Model which has a three-month cliff.
After this time, the tokens emitted are tied to the percentage of TVL/PENDLE on Equilibria to Pendle, more TVL more EQB emitted. And it will be minted along with the EQB emission of Pendle LP Incentives and it’s capped by the ratio of those 2 sectors. Here are the full tiers for how this allocation works:
For example, if TVL reaches 40% of the Pendle TVL, it means there will be 40% of the PENDLE incentives earned from Equilibria. According to the tier mapping above, if there are 100 EQB minted with PENDLE reward on Equilibria, there will be 36.6 EQB going to the team.
Here is a simulation showing the difference between PDM and a traditional time-based emission model:
The system adopted by Equilibria ensures fairer and more performance-driven results.
Pre-sale Investors(2.5% of total supply):
Equilibria values its investors and acknowledges their important role in the project's growth. A three-month cliff and a subsequent 21-month vesting period are applied to their allocation, providing a structured release of tokens that aligns with the project's development.
IDO(7.5% of total supply):
Equilibria has allocated a portion of tokens to an Initial DEX Offering (IDO). 50% of this allocation is initially unlocked, followed by a six-month vesting period. Further details regarding the IDO will be announced in the near future.
Here is a token emission simulation over the next 4 years:
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