Ongoing Incentives for Traders and Makers (LPs)
Hubble Exchange does not yet have a token which poses an interesting challenge when it comes to garnering liquidity. How does an exchange secure its liquidity without a token?
The Voucher System exists to address this challenge.
Vouchers are token-convertible instruments which represent exact future ownership in the DAO. As interest rates rise across the board in an uncertain economic environment, capital gets more expensive and the market for liquidity becomes more competitive. A transparency in rewards enabled through the Voucher System, hereafter known as vHubble, allows Hubble Exchange to compete for liquidity more effectively.
Overview of vHubble
Each vHubble will be exchanged for Hubble Exchange Tokens in a 1:1 ratio in the future. The following vesting will be applied to vHubble owners:
- 70% of all vHubble will be unlocked at the Token Generation Event (TGE).
- 15% of vHubble will be vested over 6 months, starting TGE.
- 15% of vHubble will be vested in the form of Key Performance Indicator (KPI) options, executable when cumulative trading volume is over $5B USD.
The KPI options will be minted at TGE.
vHubble have a few key characteristics:
- vHubble are Non-transferrable.
- Are off-chain and;
- Hold no Governance Power until TGE.
Liquidity Mining Incentives
At launch, Hubble Exchange will support the AVAX-PERP market only. The only depositable assets will be AVAX, USDC and Hubble Virtual USD (hUSD). Although USDC will be depositable, it is important to note deposited USDC will be used to mint Hubble Virtual USD (hUSD) which would be used as collateral.
The incentives are for Makers to provide liquidity in the AVAX-PERP vAMM.
Key details:
- AVAX-PERP Market
- Duration: Indefinitely, currently ongoing until a governance proposal amends them.
- Pool capped at $10,000,000
- 4,000,000 vHubble (0.4%) per month.
Trading Incentives
The trading Incentives are proposed to be split amongst two types: volume rewards and open interest rewards. The rewards for each are split amongst two pools, one for retail traders and bots and one for retail traders only. Traders are eligible to receive rewards in both pools.
1. Traders and Bots (85%)
In this pool, swaps done directly through the UI will be covered and swaps that are not made through the exchange interface will also be eligible.
2. Traders only (15%)
In this pool, only swaps done directly through the UI will be covered.
Volume Rewards
Monthly Allocation: 0.15% (1,500,000 vHubble)
Processed Daily
Traders will be eligible for all volume rewards, but a total of 15% of the volume rewards will be reserved in a pool for traders only, to which bots will not be eligible.
Duration: Indefinitely, currently ongoing until a governance proposal amends them.
The volume rewards are distributed based on the volume traded by a trader during the duration of the month relative to the total volume in the month.
Volume by trader / total volume * Rewards
Open Interest Rewards
Monthly Allocation: 0.05% (500,000 vHubble)
Processed Daily
Similar to volume rewards, traders will be eligible for all open interest rewards, but a total of 15% of the open interest rewards will be reserved in a pool for traders only, to which bots will not be eligible.
Duration: Indefinitely, currently ongoing until a governance proposal amends them.
A trader’s open interest is the USD value of all their open positions.
Trader’s average open interest / Sum of all Traders’ Avg. Open interest
A trader’s open interest will be measured every minute (at a random time in each minute). The trader’s Average Open Interest would be determined during the duration of the incentives (4 weeks).