On TORQ Incentives

Torque
3 min readAug 22, 2023

Let’s dive into how TORQ will be distributed to empower decentralized governance of Torque, a DeFi automation network powering Torque USD & other cutting-edge financial opportunities on the Arbitrum network.

Torque Protocol Explainer

You may discover TORQ’s tokenomics in our docs. To summarize, 24% (24b) of the 100b is allocated as incentives & distributed as follows:

  • Boost: Compound yield via dynamic digital asset strategies, 8b
  • Borrow: One-click CDP loans built on Compound V3, 8b
  • Farm: Stake USD LP tokens for TORQ rewards, 8b

Purpose

Incentives are rewards directed to liquidity providers in exchange for contributing their assets to the Torque protocol. It would be similar to a world where the depositors of a bank receive voting power as it relates to the bank’s future decision-making. These incentives, & TORQ token in general, serve a single purpose: to empower decentralized governance. We estimate incentive distribution will remain active for a period of 3–5 years.

Torque, as an automation layer, will be decentralized from day 1. Beyond launch, the core team will be recognizable only as community members & further development will be carried on by those appointed by the Torque DAO. For example, Phantom may manage Torque’s strategies. Strategies control how Torque & Torque USD deposits are routed across DeFi.

APR (Rates)

The TORQ incentive rates are initialized with the values provided above, but remain subject to change based on a holder vote. Regarding Boost & Borrow, the formula used to calculate users’ TORQ rewards is as follows:

Reward for User i = (Liquidity provided by User i * Duration in Days) / (Sum of all users' Liquidity * Duration) * Total TORQ Rewards

Conclusion

At the end of the day, what we’ve built is a personal saving network that is owned by its depositors. Unlike a bank, Torque deposits flow in a trust-less fashion to & through multiple blue-chip protocols to capture the top yield & loan opportunities, while managing risk, within a single click.

This can’t be accomplished without the introduction of TORQ token for decentralized governance capabilities. With that being said, the core team looks forward to Torque on mainnet (just around the corner). Please stay tuned for new updates & join us on Telegram for community discussion.

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The information provided in this Medium Post pertaining to Torque (the “Protocol”), it’s assets, strategy, & operations, is for general informational purposes only & is not a formal offer to sell or a solicitation of an offer to trade securities, options, futures, or other derivatives related to securities in any jurisdiction, & it’s content is not prescribed by securities laws. Information contained in this Medium Post should not be relied upon as advice to buy or sell or hold such securities or as an offer to sell such securities. This Medium Post does not take into account nor does it provide any tax, legal, or investment advice or opinion regarding the specific investment objectives or financial situation of any person. Torque Inc. & it’s agents make no representation or warranties, expressed or implied, as to the accuracy of such information & Torque Inc. expressly disclaims any & all liability that may be based on such information or errors or omissions thereof. Torque Inc. reserves the right to amend or replace the information contained, in part or entirely, at any time, & undertakes no obligation to provide the recipient with amended information or to notify the recipient thereof. The information contained in this Medium Post supersedes any prior Medium Post or conversation concerning the same, similar, or related information. Information, representations, or other statements not contained herein shall not be relied upon for any purpose. Do review our complete terms of service before interfacing or otherwise interacting.

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