We recently talked about the impending launch of VEX, Vexchange’s governance token. In the article, we mentioned the initial launch would include yield farming subsidies for VEX/VET. Since then there have been numerous questions and this article attempts to introduce some clarity and act as an FAQ around the launch.
Our yield farming program aims to incentivize VEX liquidity, expand the voting power to those who miss out on the airdrop, and distribute the governance token to those who have the most skin in the game.
What is Yield Farming?
In short, yield farming protocols incentivize liquidity providers (LP) to stake or lock up their crypto assets in a smart contract-based liquidity pool. These incentives can be a percentage of transaction fees, interest from lenders, or a governance token (see liquidity mining below). These returns are expressed as an annual percentage yield (APY). As more investors add funds to the related liquidity pool, the value of the issued returns decrease accordingly.
VEX/VET Yield Farming
The Vexchange V2 VEX/VET pair will initially be the only pair with yield farming rewards. This is meant to act as an example & simple yield farming program. The goal is for governance to determine future programs once that module is complete and goes live. The parameters for the VEX/VET farming are:
- Launching 9 November 1300 UTC
- ~13,700 VEX / day emissions
- Emissions can be adjusted/renewed once per month by governance
- 5% allocation covers 12 months of emissions if governance does not make any changes
How do I Yield Farm?
The essential high-level steps to yield farming are as follows:
- Deposit VEX into VEX/VET liquidity pool on Vexchange. Once deposited you will receive your VEX/VET LP tokens.
- Deposit VEX/VET into Vexchange’s yield farming interface.
- Earn yield in the form of additional VEX
You can claim and unstake at any time
As with all DeFi applications, you will have to allow Vexchange and our farming interface to act on your behalf by an approval transaction. This action will be shown and apparent in the UI on both Vexchange and our farming website
Risks of Yield Farming
Our Yield Farming contracts leverage existing codebases. However, it is important to note that Yield Farming, just like other DeFi products, can be risky. Some of the risks include:
- Impermanent loss
- Smart contract bugs
Here are some articles that further go into detail on the risks of Yield farming.
Additional Yield Farms
Governance will be able to vote to add additional yield farming pairs. These pairs should be chosen to maximize platform volume & revenue. There is also an opportunity for other projects in the ecosystem to partner with the VEX DAO and multi reward yield farming on key pairs for the projects.
If governance wishes to introduce one-off, additional airdrops for users that missed out on the initial VEX airdrop, this is something that can be voted on, tasked up, and executed upon. The initial discussion will be facilitated via a hosted forum, going live as part of the governance module.
The original plan was to leave the job of creating the VEX/VET pair up to initial VEX holders. But after feedback from community members around initial liquidity concerns, we have decided to lock 1% of all VEX along with the V2 fees accumulated to date in the VEX/VET pair. The LP tokens will then be transferred to the Governance Timelock that will be under the control of VEX holders who can eventually determine the fate of this LP.
While this will provide some amount of initial liquidity, users are still urged to exercise caution and control their slippage/trade price if they wish to purchase/sell on and around VEX launch. All transactions on the VeChain blockchain are immutable and thus final & non-reversible.
Was there a presale?
Can I join the presale?
Is Vexchange created by VeChain?
The Vexchange team works very closely and is in constant communication with the VeChain Foundation. However, Vexchange is not affiliated with VeChain.
Can I use Metamask or Trust Wallet?
It's important to note that Sync has two versions. We recommend Sync 2
How will I know if I’ve been airdropped VEX?
If You Know, You Know
Just kidding, you will be able to see your VEX balance on the 9th of November at 1300 UTC on Vexchange.io. If you missed the airdrop Vex will be available to purchase on the 9th of November at 1300 UTC
When and where will VEX be tradable?
VEX will be tradable on Vexchange.io on the 9th of November at 1300 UTC
Any plans to list VEX on other exchanges?
As of the release of this article, Vexchange has not been focusing on other exchange listings. However, we know Vex on other exchanges is important for accessibility and growth.
- Follow Vexchange on Twitter for future updates