VIP-1: Proposal to implement Volt staking model with an underlying governance model service

Proposals
1

Summary
We propose a staking mechanism which will serve as a way to accrue governance tokens, xVolt.

Motivation
In order to have a safe governance model, as well as a healthier token status, the implementation of a single-asset staking pool of the hub’s native token, Volt, is a must-have. The platform charges a 0.30% fee for swaps made on our protocol, and that fee is being distributed to liquidity providers.
We propose implementing a staking model for the Volt token, with a receipt token that will be used to participate in governance (xVolt) (further explained here: https://docs.voltage.finance/governance).
.)In order to incentivize the community to stake their Volt tokens, as well as to participate in governance, we propose the following model:
Of the 0.30% swap fees Voltage is charging, distribute the fees in the following order; 0.25% to liquidity providers, and 0.05% to Volt stakers.
The fees accrued for stakers will be used to perform buybacks of the Volt token, which then will be distributed to stakers, equal to their share of the staking pool.

Voting period
The voting process begins on 10/03/2022 at 12:00PM UTC. The vote for this proposal will last 24 hours. The link to the Snapshot is here: Snapshot

For: the Voltage team will implement the staking/governance model
Against: no action will be taken

2

Can you provide some rough estimates of the staking rewards? For example:
“Based on current swap volume, N Volt tokens would be available per week or month for distribution to stakers. Assuming Y% of tokens after TGE get staked, staking rewards would be Z%”.

1 Like
3

sounds like a solid idea. especially if one was just going to hold Volt anyway, for the governance aspect. will both tokens be used for voting? Volt and sVOLT (staked Volt)? can the .3% be changed to .5% with a .2% to stakers and .3% to LP providers? how was the .3% decided on? is this that standard swap fee on voltage app?

2 Likes
4

It’s based on the trading volume on Voltage, as you said.
So, it’s pretty hard to give a precise estimate. The yield is rather dynamic. The Volt:xVolt ratio will grow over time in favor of xVolt, meaning 1 xVolt will be worth more and more Volt as the protocol is used to swap tokens.

5

The first proposal will require Volt tokens. Once it (if) it goes through, xVolt will be used for voting.

Technically, the % can be changed, but it’s first needed a proposal is created, and that it’s been voted on.

The 0.30% was decided on based on other major dexes on other chains. 0.3% is the standard trading fee, and that’s why we accepted that model.