State of the Reactor - October 14, 2022
In this week's update, the Tokemak team discussed the project's roadmap, including details about accTOKE, v2, and sustainable emissions.
- The latest code updates have been pushed to Github. This push has been scanned with security audit software and condensed to remove all history and eliminate potential key leaks from past commits.
- Going forward, additional DAO governance actions will be introduced, including votes on parts of the upcoming developments outlined in the roadmap.
- It’s delivery season! The remainder of this quarter and early 2023 will feature a series of new product releases, including major updates to Pair Reactors, the launch of accTOKE, an improved emissions structure, and the full launch of Tokemak v2.
Pair Reactors [5:50]
- Genesis Pools were originally introduced to bootstrap new Pair Reactors. This concept will be re-introduced with Pair Reactors to allow for a simplified staking experience while depositing into base asset pools. This change will also increase the efficiency of Liquidity Provider rewards, as there will no longer be Liquidity Directors voting on these pools. (There will be an announcement coming soon on this subject, as well as a transitional period).
- There are no direct plans to prune Pair Reactor pools with the update to the improved Genesis Pool model.
- accTOKE will offer an additional mechanism to stake TOKE in order to receive increased yield. Rewards will be distributed in WETH, with the ability to automatically unwrap upon claim. There will be a 2-8 week lock period offered initially, with longer locking periods coming in the future. This limit is to prevent users from being locked in beyond the major v2 system overhaul.
- Liquidity Directors will continue to receive (reduced) TOKE rewards, while accTOKE stakers will receive WETH rewards but will not have the ability to direct liquidity.
- accTOKE is an improvement to the TOKE tokenomics for all network participants. The two primary user groups of Tokemak are DAOs and those who are primarily interested in capturing the protocol’s upside potential.
- DAOs are interested in Tokemak’s utility for deploying liquidity and are often neutral when it comes to rewards, whereas accTOKE stakers are less likely to desire the ability to direct liquidity, but want to collect rewards. The updated rewards mechanics allows both these types of network participants to utilize the system as desired.
- This mechanic also simplifies the design of the reward system and allows the protocol to harness the power of the deployment of Protocol Owned Assets (POA). [11:00]
- Initially there will be caps on the accTOKE locking quantity as the system transitions to the new mechanic. [12:30]
- Liquidity Provider deployments will still accrue value to the protocol treasury, and POA deployments will accrue value to accTOKE. This allows the protocol to continue growing its treasury of assets while also benefiting TOKE stakers.
- The new dynamics will reduce rewards for liquidity directing, break the reflexivity with the value of TOKE, and allow much improved value accrual. [14:30]
- There will be a community vote on whether to increase utility for accTOKE stakers by implementing the ability to direct liquidity. However, this would reduce their concentration of WETH rewards.
Tokemak v2 [16:15]
- v2 will be a major overhaul to the platform in terms of both the front and back end, and will enable the protocol to achieve its goal of becoming a liquidity bandwidth layer.
- DeFi users, projects, and market makers will benefit from the new mechanics.
- v2 will change the way liquidity is deployed from a “push” to a “pull” model, where self-serve users will specify their requested liquidity needs, and the protocol will organize the various participants.
- The new protocol design will move us beyond the initial CoRE event structure, and reduce the requirements for projects to allocate their own tokens and resources.
Sustainable Emissions Update [19:30]
- In the current model, rewards do not factor in the profitability of deployed liquidity. The new model will take into account the performance of deployments while maintaining a system balance.
Wrapping Up [21:00]
- The C.o.R.E.3 Discord channel will be removed.
- Question: “A lot of Tokemak’s revenue comes from [Curve and Convex]. Should we expect the same thing going forward?” Answer: This is due to how the weekly rewards are displayed – other deployments do receive revenue, but these rewards are not realized each week so they are under-reported. [22:00]
- Craig is back from DevCon, where he had good conversations with potential partners.