0xDAO v2 Launch Preparation (2024)

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At 0xDAO, a lot has been happening behind the scenes. As we are less than one week from SOLID emissions beginning, and the launch of 0xDAO’s next phase, it’s time to start pulling back the curtain.

Over the past week, we have been wrapping up protocol development, submitting bug reports for Solidly, and moving forward with a thorough code review of the protocol with several senior solidity developers. Additionally, we have finalized our tokenomics in detail, and have been compiling everything in our docs for easy reference. Needless to say, we’re incredibly excited to share this with you all.

Below we’ll discuss what v1 vs v2 OXD means, current partner commitments, a deep dive on protocol tokenomics, and finally will walk through a detailed reasoning of why future partners might choose 0xDAO. Let’s get to it.

Version 1 of OXD was used to bootstrap 0xDAO’s TVL, with the primary goal of becoming a top 25 protocol by TVL on Fantom to receive a share of Solidly’s veNFT airdrop. This goal was a success, and OXDv1 was designed to be a tokenized, fractional representation of 0xDAO’s veNFT. However, with the evolution of the protocol into a yield hub for Solidly, it has become much more.

Burning OXDv1 for oxSOLID

As previously stated, current OXD holders will be able to burn their existing OXD for a proportional share of oxSOLID, and will be treated as partners for the purpose of OXDv2 emissions. Claims will be determined by the following simple formula:

oxSOLID = ( OXD burned / OXD Circulating Supply) * SOLID in 0xDAO veNFT

There is no deadline to burn OXDv1 for oxSOLID. For more details about oxSOLID, read below.

OXDv2

Our intention from the outset was to preserve long-term value for the Fantom ecosystem — and to accomplish that goal, we are building out 0xDAO as a liquidity hub on Fantom. Version 2 OXD is the token that will power 0xDAO’s new goal. This is a completely new token from v1, and all further usage of OXD in this article is referring to OXDv2.

Similar to CVX for Convex, OXD will help support the growth of 0xDAO by rewarding LPs and SOLID lockers, and will be used to direct the voting power of 0xDAO’s total veSOLID. For an in-depth dive on OXD tokenomics and distribution, read below.

While several of the largest protocols on Fantom are already members of 0xDAO, we encourage all protocols with an interest in the Solidly ecosystem to carefully consider the benefits of joining us, which we will outline in detail later in this post.

Launch Partners

As of today, 0xDAO’s confirmed launch partners (in veNFT size order) are:

• SpookySwap
• Tomb Finance
• SCREAM
• Reaper Farm
• Beethoven X
• Liquid Driver
• Tarot

We are in discussions with multiple other protocols, and look forward to announcing more partnerships soon. Combined with 0xDAO’s veNFT, we have commitments from almost 37% of all locked SOLID.

Why join 0xDAO?

For those protocols who have yet to make a firm decision, we believe that our tokenomics and smart contract design makes 0xDAO the ideal partner for optimizing returns and maximizing voting power from your Solidly veNFT.

The protocol, and specifically its tokenomics, were designed for partners, by partners. We believe that by properly incentivizing partners, we can offer the best yields to LPs and SOLID lockers, further increasing the benefits of 0xDAO to partners, LPs, and the Fantom ecosystem as a whole. For a direct comparison of the benefits of 0xDAO vs Solidex, please scroll to the end of this post.

OxDAO’s tokenomics are evolving. Revealed in last week’s Medium post and discussed further during our AMA with Beefy Finance, we believe we have developed a tokenomics system that optimally supports partners, SOLID lockers, and LPs.

oxSOLID Benefits

• No dilution, as ve(3,3) rebases are passed along to stakers as more oxSOLID.
• Since oxSOLID is a liquid token, it allows stakers to easily exit their locked position at any time.
• Receive a 10% share of SOLID earned by 0xDAO protocol LPs, as SOLID.
• Protocol-optimized Solidly trading fees.
• Protocol-optimized Solidly gauge bribes.
• At least 5% floor share of all OXD emissions (see below for bonus details).
• Claim on any veSOLID aidrops.

Bonus OXD emissions:

• oxSOLID stakers have large upside above their floor amount of OXD emission, determined by the following formula:

OXD Earned = (Current oxSOLID Staked / Total SOLID)

• For example, if you hold 1% of all SOLID as oxSOLID, you will receive 1% of all OXD emissions, instead of sharing 5% with other oxSOLID stakers.
• oxSOLID stakers will earn whichever number is greater between the floor and this formula. This incentivizes stakers to continue growing their oxSOLID lock in order to receive a greater share of OXD emissions.

Partner Program

• Any oxSOLID staker contributing significantly to bootstrapping 0xDAO’s SOLID lock is eligible to be a partner. If a holder outside of the original 25 launch protocols accumulates at least as much oxSOLID as the smallest partner (Tarot: 452,870 SOLID), they will be considered a partner and migrated to the partner emissions structure.

Additional Partner Benefits

Since partners are helping to bootstrap 0xDAO with a significant veSOLID lock, their OXD emissions are handled differently than normal oxSOLID stakers. As stated above, anyone can become a partner by staking sufficient oxSOLID, and thus, there is no cutoff deadline to join and receive full partner rewards.

Partner OXD emissions

• Partners receive a minimum (floor) percentage of OXD emissions above normal oxSOLID stakers, calculated as:

Floor Partner OXD Earned = 2 * (Initial oxSOLID Staked / Total SOLID)

• For example, if a partner deposits their veNFT that is worth 2% of the total SOLID supply, then they will receive 4% of OXD emissions.
• As for other oxSOLID stakers, partners also have large upside above their floor amount of OXD emission:

OXD Earned = (Current oxSOLID Staked / Total SOLID)

• Partners will earn whichever number is greater between the floor and this formula. This incentivizes partners to continue growing their oxSOLID lock in order to receive a greater share of OXD emissions.
• OXD emissions allocated to partners have a maximum total floor of 25% of all OXD emissions. Once the combined partner floor reaches 25%, the floor portion of the OXD emissions will be distributed using the following formula:

Floor Partner OXD Earned = Partner Initial oxSOLID / Total Partner Initial oxSOLID * 0.25

LP Benefits

0xDAO allows liquidity providers to earn boosted SOLID and liquidity mining rewards with minimal effort.

• Earn claimable SOLID with a high boost without locking any SOLID.
• Earn OXD rewards based on SOLID earned.
• Liquidity providers for 0xDAO pairs (oxSOLID/SOLID & OXD/WFTM) can earn an additional 0–5% platform fee in oxSOLID. By default this is set to 0%, but can be raised by a governance vote if needed to better incentivize liquidity.

OXD Overview

OXD is the governance token for 0xDAO. OXD is locked for 16 weeks and converted to vote-locked OXD (vlOXD), which has the following properties:

• vlOXD is used for voting on how 0xDAO allocates its veSOLID toward Solidly gauge weight votes
• Receives 5% of 0xDAO LP SOLID yield as oxSOLID.
• Receives vlOXD bribes for gauge weight voting.

Voting Details

The Solidly system allows veSOLID holders to vote on-chain to direct how SOLID emissions are distributed by assigning weights to each pool’s “gauge”. As a holder of veSOLID, 0xDAO can participate in these voting procedures, and these voting rights are passed to vlOXD holders. 0xDAO will also work to optimize Solidly bribes and fees.

• vlOXD voting for SOLID emissions will be performed on-chain.
• Users can vote and change their vote at any time.
• Users do not need to vote every week for their votes to count.
• Votes can be positive or negative.
• Positive and negative votes of the same value have the same weight in the context of a user.
• Voting snapshots are submitted weekly before the period epoch (Thursday 00:00+00 UTC).

OXD Token Distribution

• Max Supply: Dynamic, based on the total SOLID supply.
• 5–25%+ to oxSOLID stakers. There is a 5% minimum distribution to all oxSOLID stakers, but no upper limit. For more details about oxSOLID and partner OXD emissions, please read the respective sections above.
• 0–95% LPs. LPs receive the remainder of OXD emissions after distribution to oxSOLID stakers. OXD is distributed proportionally to SOLID earned by a given pool.
• 0–5% to Treasury. This must be voted in by vlOXD holders. Defaults to 0%.
• 0% to 0xDAO Team.

OXD Fee Structure

There is a 15% total fee on all SOLID revenue generated by Solidly LPs on our platform. Fees can be adjusted within the following hard-coded ranges:

• 10% goes to oxSOLID stakers. This is paid out as SOLID.
• 5% goes to vote-locked OXD. This is paid out as oxSOLID.
• 0–5% goes to oxSOLID/SOLID and OXD/WFTM LPs. This is paid out as oxSOLID. This must be voted in by vlOXD holders.
• 0–5% goes to the treasury. This must be voted in by vlOXD holders.

As could be expected when trying to compare two protocols that haven’t fully launched yet, there has been a great deal of confusion around the benefits of a protocol or user choosing to use Solidex or 0xDAO (or stake on their own). In order to simplify this process, we’ve laid out the similarities and differences below, to the best of our knowledge. If you prefer spreadsheets, we’ve also created this sheet modeling potential emissions with different numbers of partners, as well as a pseudo-table directly comparing various aspects on the second page.

SOLID Locker Benefits

• Both protocols offer tokenized veNFT assets that receive 10% of LP SOLID yield.
• SOLIDsex stakers receive 3.5% of SEX emissions. oxSOLID stakers receive a minimum of 5% of OXD emissions, with higher upside if they lock more oxSOLID relative to SOLID supply.
• oxSOLID stakers receive ve(3,3) rebases as oxSOLID, as well as Solidly bribes and trading fees. SOLIDsex stakers do not receive any of these rewards, as they instead flow to SEX lockers.
• Locking veSOLID on your own entitles a holder to ve(3,3) rebases and Solidly trading fees and bribes for the gauges the holder votes for.

Partner Benefits

• Solidex has a hard cutoff at midnight UTC on Feb 23rd to lock the veNFT and still receive early partner benefits. The final deadline to join with reduced benefits is March 9th. 0xDAO partners can join at any time.
• Early SEX partners receive 10–15% (currently 10%) of SEX emissions, with first 3 months lump sum up front. Final SEX partners receive 50% reduction in their long-term emissions, with linear decay to 0 over 2 weeks. 0xDAO partners receive a higher floor of OXD emissions than normal oxSOLID stakers, with a maximum combined floor of 25% of OXD emissions, but have unlimited upside should they lock more oxSOLID.
• While it’s difficult to quantify exact numbers of SEX vs OXD emissions, we can use one example from our emissions modeling. If Frax were to join Solidex today, they would receive 0.81% of SEX emissions. If they were to join 0xDAO, they would receive 1.20% of emissions (again, OXD emissions could increase if Frax locked a greater ratio of oxSOLID / total SOLID).
• It’s worth noting that the relative voting power for partner protocols joining Solidex or 0xDAO is currently fairly different (SEX votes are diluted by a factor of 3.37, while OXD votes by a factor of 2.50), meaning that a partner needs 3.37% of veSOLID for 1% of SEX emissions, but 2.50% of veSOLID for 1% of OXD emissions. Additionally, if we simulate the protocols accruing more partners, the disparity widens. With 11 partners each, Solidex’s vote dilution increases to 3.95, but 0xDAO’s stays at 2.50, and only begins to increase once amassing more than 62.5% of all veNFT votes. See emissions modeling for all numbers.
• Solidex offers down-vote protection (2 gauges at a time) and token whitelisting (1 per month) for early partners. As a coalition of aligned partners, 0xDAO will support our partners to whitelist tokens as-needed, and does not anticipate needing to protect partners from down-voting each other. However, should the need arise, we can re-evaluate.
• 0xDAO also invites any partner to choose a representative from their team to be added to the 0xDAO multisig, allowing greater insight and transparency of protocol transactions. For partners, by partners. 🤝

Gov Token Locker Benefits

• Both protocols require locking their native token (SEX or OXD) for voting. OxDAO has a 16-week lock, while Solidex has a variable 1–16 week lock.
• Both protocols pay out 5% of LP SOLID rewards to lockers, as oxSOLID or SOLIDsex for the respective protocols.
• 0xDAO supports bribes to vlOXD holders. This is not mentioned in Solidex’s tokenomics for vlSEX.
• Solidex pays Solidly bribes, trading fees, and ve(3,3) rebases to SEX lockers, while 0xDAO does not (these go to oxSOLID stakers).

LP Benefits

• Both protocols offer boosted rewards to LPs, with a 15% fee on SOLID earned that is paid out to gov token and SOLID lockers.
• Both protocols offer gov token emissions to LPs (SEX or OXD). Solidex is currently offering 66.5% of all SEX to LPs. While 0xDAO’s number is variable, it will likely launch with around 80% of all OXD emissions going to LPs, with this number decreasing over time as oxSOLID stakers lock more SOLID and earn more OXD rewards.

Token Distribution

• Solidex has 66.5% of SEX going to LPs, 20% going to the team, 10% going to partners, and 3.5% going to SOLIDsex stakers.
• 0xDAO has 5%-25%+ going to oxSOLID stakers, including partners. This number will likely increase over time as more SOLID is locked as oxSOLID, and essentially means that for every percent of SOLID supply locked in 0xDAO, the same percentage of OXD will be flowing to oxSOLID stakers.
• LPs receive all remaining OXD after oxSOLID staker’s amount is removed. There is an option to direct up to 5% of OXD emissions to the treasury, but this must be turned on via a governance vote and by default is set to 0. There is no team allocation.

As the final days before launch are upon us, we will continue to polish our UI, review our codebase (test, test, test), deploy the new website, publish our docs (all of the info in this post + more!) and everything else needed to ensure that the protocol is ready before SOLID emissions begin.

We’re incredibly excited about what we’ve built, the benefits that it will provide to our partners and users, and everything to come with Solidly and 0xDAO over the next few months. We think it is an amazing time to be building on Fantom, and we can’t wait to see what happens next.

Feel free to reach out in the 0xDAO discord with any comments or questions. Also, we encourage any interested partners to reach out to Dr. Liquid (Dr.Liquid#1303), EerieEight (EerieEight#0706) or Screamsh (Screamsh#4525) on Discord for more information about joining 0xDAO.

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