Solidex's Governance Token (veSDX)

• Token Name: Solidex's Governance Token

• Ticker: veSDX

• Type: ERC-721 token represented as an NFT (non-fungible token).

• Blockchain: Cronos chain.

• Purpose: veSDX serves as the governance token for Solidex, enabling holders to participate in protocol decision-making.

1. How to obtain veSDX?

SDX holders can obtain veSDX by vote-escrowing their tokens, which are then converted into a veSDX (also referred to as Lock or veNFT). Additional SDX tokens can be added to an existing veNFT at any time.

The locking period (or vote-escrow period, giving rise to the "ve" prefix) can be up to 4 years, with the voting power determined linearly:

• Lock 100 SDX for 4 years → Receive 100 veSDX

• Lock 100 SDX for 2 years → Receive 50 veSDX

Longer lock durations grant higher voting power (voting weight) for the locked balance.

Auto-Max Lock Feature

Solidex Locks (veNFTs) can be set to Auto-Max Lock, which the protocol treats as being locked for the maximum duration of 4 years. These veNFTs maintain their full voting power without decay. The Auto-Max Lock feature can be toggled on or off for each Lock.

2. veSDX Utilities:

The ve(3,3) token provides holders with several key benefits:

• Voting Power: Holders can vote weekly on gauges, which determine emission distributions.

• Fee Sharing: Access a significant portion of trading fees and all associated pool incentives.

• Liquidity Incentives: Liquidity Providers receive their share of protocol token emissions.

• Governance Participation: Token holders can vote on protocol improvement proposals, shaping the future of the protocol.

This structure creates a robust utility model, encouraging active participation, rewarding contributions, and fostering the protocol’s growth and development.

3. Rebase Mechanism for veSDX holders

veSDX token holders benefit from a rebase mechanism designed to mitigate vote power dilution and incentivize locking. Rebases are proportional to SDX emissions and the ratio of veSDX supply to total SDX supply.

The rebase amount is calculated using the formula:

$$Rebase = weeklyEmissions \times \left(1 - \frac{veSDX.totalSupply}{SDX.totalSupply}\right)^2 \times 0.5$$

Key Highlights:

• Rebases reward veSDX holders most when the locking rate decreases, encouraging new participants to lock tokens.

• The total veSDX supply does not impact the emissions distributed to liquidity providers.

This structured approach ensures an equitable and sustainable token distribution model while empowering veSDX holders with governance and rewards.