Locked $sPRIME airdrops

Locked $sPRIME

“Once tokens are emitted, they can’t be returned”. Fixed emissions run the risk of external event impacts, which is the reason our main emission schedule is event based. The same goes for our incentives. The vast majority of incentives not provided by our partners will be given out in locked $sPRIME. While locked $sPRIME can’t be redeemed for underlying assets, it can be used for their other use cases:

  • Locked $sPRIME can be used to pay for $PRIME features. This benefits the user without inflating the token

  • Locked $sPRIME can be used to support DeltaPrime by keeping the LP active. This rewards the user with 33% of protocol revenue

  • Locked $sPRIME can be used to generate governance power

Locked $sPRIME is created from the community allocation. Because the Community Owned Liquidity (COL) is provided over a very wide range, without rebalancing, the percentage of idle COL increases with $PRIME price appreciation. This reduces its capital efficiency as opposed to turning it into $sPRIME (concentrating it around the current price). For this reason, idle COL will be matched with $PRIME from the community allocation to create $sPRIME. This $sPRIME will be locked to prevent token inflation, while providing recipients with the $sPRIME benefits stated above. Locked $sPRIME is airdropped based on achievements reached by individual DeltaPrime users (think: over x$ USDC provided over three months, or total borrowed value over one month, etc.). These achievements will be determined and adapted over time. Most of the achievements will also be connected to certain prerequisites for keeping the locked sPRIME. For example: The $sPRIME might be required to stay active for at least 21 days per month; or the realized IL might need to stay under 10% of the airdropped $sPRIME value. If the requirements are not fulfilled, the locked $sPRIME can be retrieved and redistributed to other DeltaPrime users. All benefits received within this period however, remain with the person who received them. Note: this potentially excludes generated governance power, based on the $sPRIME / usage ratio. More on this in the Governance power section.

Due to its inflation-resilient design, as well as the possibility to retrieve and reallocate airdrops, DeltaPrime is able to allow for significantly larger incentives than many other projects. This allows the project to adapt its incentive strategies over the long term without having to hold back in incentive allocation size.

Note that turning COL into locked sPRIME does not involve the buying or selling of $PRIME, nor does it involve the removal of any AVAX / ETH from the underlying liquidity pool. AVAX / ETH is reallocated to concentrate around the current price, while community allocation is used to equalize price stability to the buy-side. The users receiving this as locked $sPRIME are tasked with keeping this capital as efficient as possible, and are rewarded for this in the process.

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