Archly Finance uses two tokens to manage its utility and governance:
$Arc— ERC-20 utility token of the protocol
$veArc— ERC-721 token in the form of an NFT (non-fungible token)
$Arc is used for rewarding liquidity providers through emissions.
$veArc is used for earning bribes and fees. Any
$Arc holder can vote-escrow their tokens and
$veArc (also known as veNFT) in exchange. Additional tokens can be
added to the
$veArc NFT at any time.
The lock period (also known as vote-escrowed period, hence the ve prefix) can be up to 4 years, following the linear relationship shown below:
$Arclocked for 4 years will become 100
$Arclocked for 1 year will become 25
The longer the vesting time, the higher the voting power (voting weight) and
$veArc holder receives.
Archly Finance mechanics reflect a combination of two DeFi concepts:
- Vote-Escrow — first introduced by Curve to strengthen incentives for long-term token holders
- Staking/Rebasing/Bonding or (3,3) game theory — designed by Olympus DAO
Combined, the ve(3,3) mechanism rewards behaviors correlated with Archly's success, such as
liquidity provision and long-term token holding. Liquidity providers receive
$veArc holders receive protocol fees, bribes, and rebases.
Below, we will walk through the components of the mechanism in order to explain how it helps the incentives flow to the most valuable of the ecosystem liquidity pools.
The airdrop claim period is now complete. Thank you to everyone who participated!
At launch we distributed
users we believe are likeliest to contribute to our
mission to become the liquidity base layer of the Telos EVM ecosystem.
$Arc tokens were distributed to the people who have played the biggest role in
incubating Archly and those likeliest to contribute to its long-term
- First 10 Telegram members (10%, 1M
- First 35 Telegram members (90%, 9M
An additional 70M
$Arc locked into
$veArc for 4 years (10M to each new chain) was airdropped to Arbitrum Nova, Arbitrum One, BNB Chain (BSC),
Fantom, Kava EVM, Optimism, and Polygon users.
The team will receive an initial allocation that it will use to vote
to drive emissions to key protocol pairs such as
$Arc-$USDC and to support
ongoing protocol development. The total team allocation is 15M (50%) in
For the Telos launch, the team vested 66.67% of its initial allocation in the form of a
$veArc locked for 4 years (indefinitely) and use it to vote for pools in perpetuity.
For the launch of additional chains, the team will receive 34M
$Arc with 15M
$Arc locked into
$veArc for 4 years (indefinitely) and 19M
to use for marketing, liquidity, and other tasks to support the team and Archly.
While a fully autonomous and immutable protocol is an admirable objective, it comes at a cost. Archly Finance will ensure its long-term sustainability by employing a dedicated team focused on supporting the product, documentation, community, and ecosystem. As the protocol evolves, the Archly team will consider introducing more immutability or DAO components where appropriate.
To cover ongoing expenses and all the upcoming development efforts, 3% of the emissions for each chain will be going to the team address.
5M (16.67%) To encourage voting for the initial pools by the First 35 and spread more Arc to LP on Telos.
The initial supply of
$Arc was 30M and 50M
$Arc will be added for each additional chain launched.
A minimum of 25M
$Arc will be locked for 4 years leaving the other 25M
$Arc in circulation. This
will allow for the inflation on each network to come down to an inflation of around a target of 1% with a 50% lock rate.
The targeted lock rate is 80% across all chains.
Weekly emissions on Telos started at about 15.58M
$Arc (51.93% of the initial supply)
and a minimum decay of at least 2% per week (epoch). For new chains the weekly emissions
should start around 9M or lower
$veArc holders receive a rebase proportional to epoch LP emissions
and the ratio of
$Arc supply, thus reducing vote power
$veArc supply plays a crucial role in determining the weekly LP emissions. The more
$Arc that is locked into
$veArc the lower the amount of the distribution of
$Arc during the next week of LP emissions. Said another way, if 100% of
$Arc is locked up as
$veArc, then the weekly LP distribution of
$Arc will be low (approaching 0
$Arc). If 0% of
$Arc is locked up, then the weekly LP distribution of
$Arc will be high. As there is no max supply of
$Arc, this system allows the
$Arc holders to determine how much inflation is introduced into the ecosystem, thus making engagement critical in keeping the supply of
$Arc in balance.
$veArc holders decide which liquidity pools receive emissions in a given epoch by
voting on their preferred liquidity pool gauges.
$Arc emissions will be distributed
proportionally to the total votes a liquidity pool receives.
In return, voters receive 100% of the trading fees and bribes collected through the liquidity pool they vote for.
Voting for gauges, or in fact any action related to the
$veArc NFT is
allowed only after one week of the previous vote being cast. This means that calling
Voter.reset() (used for
resetting an NFT vote state and usually required before merging it into another
$veArc NFT) or
Voter.poke() (used to re-cast the votes for the current epoch in
order to direct emissions and earn bribes) are not available until the one week vote lock has expired.
While this is not ideal, it does make the protocol safer against potential exploitative behaviour.
There are 4 types of rewards on Archly Finance.
$Arc distributed to liquidity pool stakers. The amount of
$Arc distributed towards every pool is proportional to the voting power
received from the voters every epoch.
These rewards are streaming and are available for claim as these accrue.
Represent liquidity pool trading fees distributed to voters in pool tokens (
e.g., if the pool is
vAMM-Arc/USDC the distributed tokens are
The tokens are streaming proportionally to the voting power cast by a voter and the accrued amount of trading fees.
These rewards are available for claim as they accrue. They do not need to be claimed each epoch.
In addition to the fees, liquidity pools allow external rewards from anyone (known as bribes). Bribes can be added to whitelisted pools and are distributed only to voters on that pool, proportionally to their share of pool votes.
These rewards are available for claim immediately after the creation of a bribe for a pool, and are proportional to the voting power cast by a
$Arc distributed to
$veArc holders in order to reduce the
voting power dilution.
These rewards are available for claim as these accrue and are streaming
proportionally to all
Rebase rewards claim is available one full epoch after tokens are locked.
An example of bribes, voting, and rewards claim timeline:
- A new epoch starts Thursday (00:00 UTC)
- Bribes are deposited at any point in the epoch
- Voters vote for their preferred pools
While Archly supports permissionless liquidity pool and gauge creation, these can only include whitelisted tokens. The protocol will launch with an extensive list of pre-whitelisted tokens.
Partners can pay the whitelisting fee in order to whitelist their projects token on Archly. The Arc paid for whitelisting is burned.
Requirements for whitelisting are critical to ensuring that the protocol cannot be exploited by actors attempting to game emissions.
To support the health of the protocol and ecosystem, the admin (a Curve-esque Emergency DAO) will have the right to disable any hostile gauges.