In the course of the past few months, a lot of exciting things going on in regards to liquidity mining. So exciting, that even other foundations behind their respective chains started to provide rewards to users of protocols willing to deploy on top of their chain.
The Fantom Foundation has been asked to do the same, but they believe that playing by the book doesn’t warrant different results. Therefore, the foundation has decided to introduce a different kind of program to better align incentives between users, builders, and the network.
The Fantom Foundation believes that builders are the best ones to judge where funds should be allocated, whether they should be provided to build the protocol, or if they need to be used for liquidity mining.
Rather than playing favorites and providing a majority of our resources to a handful of protocols, this would be opened up to every dev team that will deploy on Fantom.
From today on, protocol teams will be allowed to apply for rewards from the Fantom Foundation based on their total value locked (TVL), scaling from 1,000,000 FTM up to 5,000,000 FTM in its first iteration, and to be changed accordingly depending on the needs of builders.
370,000,000 FTM would be committed to this program.
The process and requirements are as follows:
1. A protocol team can apply for rewards if the TVL on that protocol can stay above a time-weighted-average of $5,000,000 or $100,000,000 for an extended period of time.
2. A submission form would be opened, where protocol teams can provide information about the protocol, a publicly-verifiable team address (preferably a multi-sig), and a DeFiLlama link to track TVL.
3. Once the Foundation has approved the application, a two-month long cliff commences, after which rewards will start to vest on a monthly-basis.
4. If at any given point, the time-weighted-average of the protocol’s TVL goes below the $5,000,000 bandwidth, rewards will be paused until the TVL climbs back up to the respective bandwidth.
For higher bands, falling under a respective bandwidth will simply move the reward tier back to the previous level or band.
5. The program applies to both new and existing protocols on Fantom.
For any further questions, you can reach out to the foundation @fantom.foundation, or on Twitter.