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Understanding PowerIndex: the Liquidity Mining Program

By reading this article you will understand the terms of the CVP liquidity mining program and how to participate in it

Understanding Powerindex articles:

  1. Understanding PowerIndex: Introduction & Basics
  2. Understanding PowerIndex: the PIPT token magic
  3. Understanding PowerIndex: liquidity provision
  4. Understanding PowerIndex: pooled tokens usage
  5. Understanding PowerIndex: the value of Index governance
  6. Understanding PowerIndex: index fees and cashflows for PIPT and CVP holders

The Liquidity Mining program for PowerIndex was issued as a proposal by Delphi Digital and is not approved at the moment of writing this article.

PowerIndex Liquidity Mining Program

The liquidity mining program is designed to reward early PowerIndex LPs.

Any PIPT holder can participate in the PowerIndex LM program. Learn more regarding options for liquidity provision and receiving PIPT.

It offers as much as 1m CVP for the first month:
Month 1: 1,000,000 CVP
Month 2: 700,000 CVP
Month 3+: 400,000 CVP

According to the proposal:

In general, 50% of rewards will vest immediately and 50% will vest over a 10 week period. In the early days, the vesting schedule will vary according to a conditional vesting parameter for PowerIndex rewards that’s based on total Index liquidity.

This “adaptive vesting” rule was developed to protect the PowerPool during the early days while TVL in PowerIndex will be less than $10m. So, the percentage of immediately unvested reward is based on TVL at the moment of reward accrual:

  1. <$1,000,000: 10% rewards immediately vest (90% 10-week vest)
  2. From $1m to $5m: 20% immediately vest (80% 10-week vest)
  3. From $5m to $10m: 35% immediately vest (65% 10-week vest)
  4. From $10m: 50% immediately vest (50% 10-week vest)

It is important to point out that if new vesting rules are applied only to newly minted tokens. The vesting rules applicable to the block in which the award was received, there is no vesting re-calculation if index liquidity expands in the future.

This reward is divided into two parts: reward for index LPs and secondary market LPs. The reward for Index LPs can be received by staking PIPT in the special mining contract. The reward for the secondary market can be received by staking BPT tokens from the PIPT-ETH 80//20 Balancer pool (the address of this pool will be provided soon). The 4/9 of reward is going to the Index LPs and 5/9 to the PIPT-ETH Balancer LPs:

Uniswap CVP-ETH liquidity mining program

For the Uniswap liquidity mining program rewards are doubled for the first month (182,000 CVP per week) with 10 weeks vesting. The Uniswap CVP-ETH pool becomes the only rewarded pool (Balancer pools are excluded from the LM Program).

Links:
PowerPool website: https://app.powerpool.finance/#/mainnet/pools/shared/
PowerIndex main website (soon): http://powerindex.io/

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PowerPool

PowerPool

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A solution for accumulating governance power in Ethereum based protocols