Lendefi — The Tokenomics

Lendefi Protocol
Jan 12 · 3 min read

LDFI is the native token of the Lendefi protocol (the “Protocol”). LDFI is a governance token which controls the interest rate model, inclusion of supported assets, reward distribution and other terms and conditions and any changes of the Protocol.

Decentralized governance

Lendefi governance via a Decentralized Autonomous Organization (“DAO”) will allow active participation of the token holders in the governance of the Protocol.

Voting

Any address holding over 1% of the tokens or voting right delegated to that address by over 1% of total supply can create proposals and the changes can be made to the Protocol via voting on the DAO.

Fees

The difference between the interest rate the borrower pays and the lender recieves, otherwise know as the spread, will be used to purchase LDFI tokens from the market for the purpose of burning and rewards.

Token burning

Through a process known as burning, LDFI tokens will be burnt, hence lowering the total and circulating supply. This will result in increasing the value of LDFI tokens, therefore creating further value for the token holders.

Rewards

A variety of rewards will be given in order to encourage the growth of the Protocol and creation of value for token holders.

Staking rewards

LDFI token holders will be able to stake their Tokens and in doing so will receive a reward in the form of LDFI tokens.

Liquidity rewards

Lendefi will operate a liquidity rewards program in order to provide rewards in the form of LDFI tokens to liquidity providers on a decentralized exchange where LDFI will be listed, such as Uniswap.

Liquidation rewards

To encourage the liquidation process, liquidators will be provided a reward in the form of a percentage of the collateral being liquidated in the case of borrower default.

Yield farming

In order to foster adoption of the Protocol, lenders and borrowers will be rewarded with LDFI tokens for using the Protocol.

Token Price

Initial circulating supply

Approximately 1,800,000 LDFI Tokens

(2,150,000 LDFI including Locked Liquidity Provisioning)

Initial market capitalization

Approximately 720,000 USDC

Uniswap liquidity provisioning

500,000 LDFI | 200,000 USDC (equivalent in ETH)

Token allocation

The Lendefi protocol will deliver leveraged trading and secured lending for cryptocurrency markets. Utilizing an undercollateralized loan model, Lendefi facilitates a trustless relationship between lender and borrower, managed by the protocol to remove counterparty risk.

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