Introduction
Towards the end of January, the Polygon foundation had launched a $15 million campaign set to build dApps (decentralized applications) to deploy solely on Polygon. The program will support specific liquidity mining (LM) and protocol development efforts and will reward projects based on on-chain metrics. An extension of the belief in #DeFiForAll and bringing it to the next 10s of millions via scalable solutions of Polygon.
Now, we’re pleased to announce our plan for LM 2.0, the next step to DeFi For All, and our vision for its architecture
LM 2.0 Mechanism
During the first phase (April 2021 - present), the Polygon foundation selected few teams to allocate Liquidity mining and protocol development grants. In spirit of decentralization and public goods - phase 2 will be different. Meritocratic and focussed towards Polygon native protocols.
Firstly, Polygon would take a snapshot for the initial airdrop amount to all those who meet the KPIs. Just to refresh, the key measure is total value locked (TVL) as calculated based on a time-weighted average price (TWAP) and / or weekly active users (WAU). For a complete run-down of these KPIs, refer to our announcement article.
After the snapshot, the dAPPs would get LM Tokens (ERC20) airdropped to a whitelisted multisig wallet. These tokens would then have to be staked in the staking pool, which is a basic staking contract to earn wMATIC rewards. The emission of both LM tokens and wMATIC would be spread linearly across 6 months.
It is important to note that the airdrops to whitelisted addresses would change, i.e., increase, decrease or remain the same. This is based on their respective KPI’s for the previous week. The average of the entire week would be taken in order to prevent TVL from flowing in during the time of the snapshot.
The snapshots would be taken once a week and the emission would change after.
Here is a high-level overview of the LM 2.0 architecture:
We are collaborating with Vesq Finance team who were very interested to help democratize this innovative and first of a kind Liquidity Mining campaign.
LM 2.0 is the next step towards DeFiForAll; our campaign to progress web3-based financial systems, powered by Polygon Technology.
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