What is veTokenomics? Thisis a new concept in the token economy. This concept aims to increase efficiency and fairness in the crypto economy.
This concept considers various factors, such as user behavior, network effects, and economic principles of supply and demand. In veTokenomics, users can lock their tokens for a certain period and get veTokens in exchange.
veToken is a non-transferable token and is used to participate in protocol governance. Additionally, users also earn a share of the protocol's revenue and higher rewards.
Apa Manfaat veTokenomics?
veTokenomics has several benefits, including:
Increase Liquidity and User Engagement
By locking up their tokens, users demonstrate a long-term commitment to the protocol and reduce the supply of tokens in the market. This can increase the value of the token and attract new users.
Additionally, by owning veToken, users can contribute to protocol decision-making and influence the direction of protocol development.
Reducing the Risk of Manipulation and Dumping
In some protocols, large token holders (whales) can manipulate token prices by buying or selling in large quantities. This can harm small users and disrupt the stability of the protocol.
With veTokenomics, whales cannot sell their veTokens easily and have to wait until the lockup period ends. This can prevent dumping practices and maintain protocol integrity.
Encouraging Innovation and Collaboration
With veTokenomics, users can provide feedback and suggestions to improve the protocol. Users can also propose and vote on new features, bug fixes, or integration with other protocols. This can encourage innovation and collaboration between developers and the community.
What is an Example of veTokenomics in Practice?
One protocol that implements veTokenomics is Curve. It is a token exchange protocol optimized for stablecoins and similarly priced tokens.
In Curve, users can provide liquidity to various pools and earn Curve DAO (CRV) tokens in return. CRV is a utility token used for various functions within the protocol, such as trading, paying fees, and participating in governance.
However, users can also lock their CRV to get veCRV, which is a vote-escrowed version of CRV. veCRV has several advantages, including:
Earning a Portion of Protocol Revenue
Users who own veCRV can earn a portion of the protocol's revenue, which comes from trading fees and withdrawal fees. This income is distributed in the form of other tokens, such as ETH, DAI, YFI and others.
Earn Higher Rewards
Users who own veCRV can increase the rewards they earn from providing liquidity to Curve pools. These rewards come from emissions of CRV and other tokens sponsored by other protocols, such as Synthetix, Aave, Compound, and others.
Affecting CRV Emission Streams
Users who have veCRV can choose which pool they want to support by casting their vote. These votes will influence the allocation of CRV emissions to the pool, which can increase the pool's liquidity and rewards.
Source: CoinTelegraph
Conclusion
veTokenomics is a new concept in token economics that aims to increase efficiency and fairness in the crypto economy. With veTokenomics, users can lock their tokens for a certain period and earn veTokens in exchange.
veToken is a non-transferable token and is used to participate in protocol governance. Additionally, users also earn a share of the protocol's revenue and higher rewards.
veTokenomics has several benefits, including increasing liquidity and user engagement, reducing the risk of manipulation and dumping, and encouraging innovation and collaboration. One protocol that implements veTokenomics is Curve, which is a token exchange protocol optimized for stablecoins and similarly priced tokens.
How To Buy Crypto With Bittime
You can buy and sell crypto assets in an easy and safe way via Bittime. Bittime is one of the best crypto applications in Indonesia which is officially registered with Bappbeti.
To be able to buy crypto assets on Bittime, make sure you have registered and completed identity verification. Apart from that, also make sure that you have sufficient balance by depositing some funds into your wallet . For your information, the minimum purchase of assets on Bittime is IDR 10,000. After that, you can purchase crypto assets in the application.
Monitor price chart movements of Bitcoin (BTC), Ethereum (ETH), Solana (SOL) and other cryptos to find out today's crypto market trends in real-time on Bittime.
Read also:
Understanding Leveraged Tokens
What is a Liquidity Provider Token (LP Token)?
What is the SPL Token Standard and Solana Token-2022
DISCLAIMER: This article is informational in nature and is not an offer or invitation to sell or buy any crypto assets. Trading crypto assets is a high-risk activity. Crypto asset prices are volatile, where prices can change significantly from time to time and Bittime is not responsible for changes in fluctuations in crypto asset exchange rates.
Comments
0 comments
Please sign in to leave a comment.