Plenty Network's PLY Token: Refreshing Tezos DeFi

This way the amount of PLY rewards that are distributed per trading pair is determined democratically.

Value through utility

Basically, if all liquidity providers have the same proportional amount of PLY tokens (and lock them for voting), then PLY distribution should be distributed proportionally to liquidity providers:

If a trading pair has a lot of liquidity providers, they would jointly have a lot of PLY and thus voting power, which they would use to vote for their own gauge, which then would distribute more PLY.

Trading pairs with less liquidity and thus less liquidity providers, and thus less PLY, would have less voting power and end up with less PLY to be distributed by their gauge.

Since the bigger trading pair has a bigger group of liquidity providers that will take a cut of the bigger amount of PLY emission, they will not necessarily earn more PLY than the smaller group.

Since that group will have less liquidity providers that take a cut from their smaller total amount of PLY emission. That way a proportional distribution is achieved.

But if people start buying more PLY to increase their voting power, they can increase their voting power and direct that to the gauge of their liking. And thus tilt the scales of PLY emission to their advantage.

This way PLY has actual value through utility. PLY could just become an interesting token in the Tezos DeFi scene.

Voting

To be able to vote, users need to lock their PLY tokens. By locking PLY tokens, you receive vePLY tokens. vePLY gives you voting rights. The longer you lock your PLY, the more voting power you have.

– Six months lock: 1 PLY – 0.125 vote

– Two years lock: 1 PLY = o.5 vote

– Four years lock: 1 PLY = 1 vote

An interesting feature is the fact that a vePLY token is an NFT and can be traded on OBJKT.com. This way your value remains liquid even though you locked your PLY tokens.

Boosting

By adding your vePLY NFT to your LP token that you stake (which will be done by a transaction I assume), you will boost your PLY earnings.

This means that you increase your staking rate and earn at a higher rate than users that have not attached a vePLY NFT to their staked LP tokens.

You can earn up to 2.5 x more PLY that way. By what factor your earning rate increases depends on other factors:

“All gauges have different boosting requirements, meaning some pools are easier to boost than others. It depends on how much others have locked and how much the liquidity gauge has”.

Bribes

If a DeFi protocol wants to increase the liquidity of the token(s) that are part of their ecosystem, Plenty DEX offers the possibility to “Bribe” users to do so. Anyone can add Bribes to a trading pair of their choosing.

This simply means that the specific gauge that is connected to a trading pair, is filled with extra tokens that are deposited by the Briber. These tokens are distributed to the people that have voted for that gauge in that specific epoch.

So by adding a bribe to the gauge, an extra incentive to vote for that trading pair is added, which increases the chances that more people vote, which increases the amount of PLY liquidity providers can earn.

That should attract more liquidity providers and increase liquidity.