Tokenomics, Retroactive Rewards, and Prelaunch Liquidity Mining Campaign for OGV

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blog.originprotocol.com2m ago

Tokenomics, Retroactive Rewards, and Prelaunch Liquidity Mining Campaign for OGV

As previously announced, we are ramping up our efforts to launch Origin Dollar Governance (OGV) as the future governance and value accrual token for Origin Dollar (OUSD). Having OGN represent both our DeFi (OUSD) and NFT (Story) products has been confusing for our community and limited OGN from reaching its full potential. We believe having separate tokens with clear utilities and value accrual mechanisms for each of our products will deliver a better outcome for our current and future token holders. We want to share some exciting updates on our progress and our latest thinking around launch timing and incentives for OGN holders, OUSD holders, and OUSD liquidity providers.

Key dates

The following dates represent our current intentions assuming no major engineering delays or other unforeseen issues (all times midnight UTC):

Today, June 1 — Prelaunch liquidity mining campaign begins June 28 — Final list of exchanges supporting OGV to be published July 5-12 — OGN snapshot window July 12 — OGV airdrop October 10 — 90-day deadline to claim airdrop OGV will be distributed to OGN holders, prelaunch liquidity providers, and OUSD users

Prelaunch liquidity mining campaign starting today

We are allocating 50M OGV to a new prelaunch liquidity mining campaign. OUSD liquidity providers will get credit for providing liquidity to OUSD pairs starting today. For context, we are allocating 5x the number of tokens versus our previous liquidity mining campaign (10M OGN) that drove the circulating supply of OUSD to approximately $300M. Further, these rewards will be accrued in a 4-week period rather than a 10-week period. The 50M in OGV rewards will be claimable by OUSD liquidity providers as calculated block by block from today until the snapshot. The eligible AMM pools are OUSD/3CRV pools on Curve and Convex. We’ve seen the power of incentives to drive strong growth in the circulating supply of OUSD leading up to the launch of OGV.

The claim process

The snapshot will be taken at a randomly chosen time during the snapshot window of July 5–12. Make sure to continue holding your OGN for the full 7 days of the snapshot window to guarantee eligibility to claim OGV.

If you are holding OGN on a centralized exchange, there is no need to move your tokens at this time. We are asking each of the 50+ centralized exchanges that have listed OGN to also support OGV for their users. We will be publishing a final list of the exchanges that are supporting the airdrop one week before the snapshot window begins. This will give users plenty of time to withdraw their OGN from any exchanges that choose not to support the airdrop.

For those managing the custody of their own coins, we will be publishing a link closer to the launch for users to claim their OGV. Users with staked OGN will also be able to claim OGV.

Eligible token holders will have 90 days to claim their OGV. After that deadline, any unclaimed OGV will be burned to reduce the initial circulating supply. We will instruct all exchanges that receive OGV on behalf of their users to do the same.

Governance

OGV will use a veOGV (vote-escrowed OGV) mechanism that distributes economic and governance power to those most committed to the long-term success of the protocol. veOGV was originally inspired by Curve’s veCRV token model, but we have introduced some major improvements to drastically reduce the code complexity and gas costs. We’ve also added the ability to stake OGV for multiple periods of time from the same wallet, enabled vote delegation, and are using an exponential instead of linear decay function for determining voter power.

OGV holders will be able to lock up their OGV anywhere from 1 week to 4 years to receive veOGV in exchange. Vote locking OGV is nonreversible and veOGV is nontransferable. While we recognize the commitment level required to maximize your voting and economic power is high, we believe it is only appropriate to delegate control of the protocol to those who are invested for the long term. In the future, we anticipate other protocols like Convex may offer liquid staking options to serve those who wish to participate on shorter time horizons.

The Origin Foundation and both Matt and I will be locking the majority of our OGV holdings for the maximum available time of 4 years.

Retroactive rewards for OUSD holders

We believe it is only appropriate for the OUSD holders to receive significant voting power alongside OGN holders. To that end, 400M OGV will be allocated for retroactive rewards to OUSD holders to be calculated pro-rata per block. Anyone who has held OUSD in their wallet since January 2021 will be able to claim veOGV (the locked and nontransferable version of OGV). OUSD holders will receive four separate grants of veOGV that will unlock annually over the next four years (25% at the end of each year). Because the veOGV is locked and nontransferable, OUSD holders will get valuable voting and economic rights for being loyal OUSD holders without adding to the initial circulating supply or causing additional sell pressure at launch.

Tokenomics

1 billion OGV will be distributed to OGN holders along with the rewards for the prelaunch liquidity mining campaign participants on July 12. The total supply of OGV on July 12 will be 4 billion, with the vast majority being locked for 1 to 4 years. The only other exception is 125M OGV which will be immediately available for the DAO to support the launch with initial liquidity provision and market-making efforts on centralized exchanges and DEXes. The remaining 2.825 billion OGV will be vote locked for up to 4 years. Having a gradual release schedule will help ensure a smooth launch and protect OGV performance. Team tokens will be locked at launch and unlock annually over 4 years just like the retroactive rewards to OUSD holders. Similarly, the remainder of the DAO holdings will unlock gradually over time 4 years to fund liquidity mining campaigns, liquidity provisioning, partnerships with exchanges and DeFi protocols, future contributors and open-source developers, new projects building on top of OUSD, long-term incentive programs, and other initiatives that are voted in by the community. We anticipate that the circulating supply at launch will be 1 billion OGV or less.

At launch, 70.62% of the total supply will be locked for up to 4 years

Staking rewards via inflation

We intend to reward users that stake their OGV for veOGV. When OGV is locked and taken out of the circulating supply, it creates obvious benefits to OGV tokenomics and performance. We want to reward users who are most committed to the long-term success of the protocol and participate in decentralized governance with their veOGV. To create ongoing incentives to get users to vote-lock their OGV, we will experiment with introducing inflation to OGV to fund staking rewards. While incentives can be a great way to drive growth, they need to be distributed in a thoughtful and sustainable way. One method that we’re seen other successful projects like Curve deploy effectively is funding future rewards using inflation. Annual inflation is anticipated to start at 20.85% in the first year, dropping to 1.49% after 4 years to create compelling incentives for OGV holders to vote-lock to veOGV and limit circulating supply even as total supply increases.

OGV uses inflation to fund staking rewards

Since we're unlikely to get everything perfect on our first try, these parameters will be configurable via decentralized governance. This will allow the community to adjust the inflation rate over time and decide how these newly introduced tokens should be distributed.

We intend for staking rewards to be a bootstrapping mechanism that will be replaced by more sustainable protocol revenue in the long term. As a reminder, 10% of the yield that is generated by OUSD is collected as a protocol fee. This fee will be used to buy back OGV on the open market to be distributed as additional rewards for stakers. While this protocol revenue will start as a small percentage of the rewards, we anticipate it will become the primary source of rewards as the circulating supply of OUSD grows.

Other updates

We’re making solid progress towards the launch. We completed our first audit with Solidified of the ERC-20 token for OGV and are in the middle of our next audit with OpenZeppelin. We are continuing to work with exchanges, wallets, portfolio trackers, and other ecosystem partners to support OGV. Multiple exchanges have already communicated their intent to support the airdrop and list OGV. We’re encouraged by the continued community enthusiasm for OGV and we couldn’t be more excited for what is to come. Please continue to spread the word about OGV to your friends.

In summary, the ways to receive OGV are to:

Hold OGN during the snapshot window (July 5 to July 12) Have held OUSD sometime between January 2021 and the snapshot Participate in the new prelaunch liquidity mining campaign that starts today by contributing to the OUSD pairs on Curve or Convex Purchase OGV on supported exchanges and DEXs when we launch

The launch of OGV represents an important step in handing over control of the protocol to the community. The more people that participate in the airdrop and the initial listings on centralized exchanges and DEXs, the greater the decentralization of the protocol. Thank you for joining us on this journey as we seek to make OUSD ubiquitous and increase its circulating supply to $1B, $10B, and beyond.

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