veTokenomic. Invest in tokens which won't be dumped. The m | DeFi [L]Earn. Strategies.

veTokenomic. Invest in tokens which won't be dumped.

The main goal of DeFi 1.0 users was to farm as many tokens and then dump them for compounded returns.

Some people get their APY -> Token price dumps. -> Other people lose money -> Everyone takes their funds and leaves the protocol.

It has been more than a year since people started to talk about DeFi 2.0, where protocols own the liquidity. However, there are not many successful examples of such projects. What we can see is just an improvement of DeFi 1.0 and moving to veTokenomics.

TLDR:
The main objective here is how to increase TVL without over-inflating circulating CRV supply.

Working models in veTokenomics:
1. Irreversible lock for long period, ex. 3 years. If you choose to farm and dump CRV, you’ll get be betting against your own CRV position.
2. Using LP tokens for vote-escrow. Allow users to influence their APY.
3. Staked tokens and veTokens are accrued over time. Withdraw anytime, but lose the boost.
4. Early unlocks with a penalty, which is redistributed to other veToken holders. The percentage of penalty depends on the protocol.
5. Ve(3,3) rebase mechanism. Every rebase user claims and restakes tokens to restore voting power.

>> To learn more, read the article <<