With the recent launch of Swapr Beta, which features a do-it-yourself farming platform, Swapr is now live on mainnet and xDai and regularly doing $225k in daily trading volume.
Over the last month, the community has been discussing ways to accelerate Swapr growth and increase community participation in Swapr’s governance, which has resulted in reaching soft consensus on launching a SWPR token to attract and develop an engaged community to govern Swapr into the future.
The post below is meant to gather feedback in preparation for a on-chain signal proposal and covers the following areas:
- Swapr Governance Rights
- SWPR Token Distribution
- Initial Liquidity Mining Campaigns
SWPR Governance
The Swapr protocol will be governed by SWPR token holders through the ERC20 Guild Structure, where tokens are locked for voting. Voting weight is determined by the number of tokens locked in the governance contract. SWPR token holders can use their voting power to:
- Adjust and govern the protocol fee
- Manage Swapr Guild treasury
- Allocate liquidity mining rewards to targeted pools
- Deploy the Swapr Guild and the Swapr protocol to additional networks
- Adjust the base pairs that trades are routed through
- Improve Swapr protocol and Swapr dApp
Swapr was developed and currently governed by DXdao. The SWPR token is the first step toward making Swapr into a more sovereign project. This will take time and also relies on a wider distribution of SWPR token during a liquidity bootstrapping phase. Over the next few months, the aforementioned governance rights will be phased in, with Snapshot serving as an intermediary governance solution for SWPR token holders until the on-chain Swapr Guild is implemented.
Fees and token value accrual
Swapr Guild Members, by owning and locking SWPR tokens in the governance contract, will vote on Swapr’s fee structure. This doesn’t just include raising or lowering the protocol fee, but also how those proceeds are allocated to stakeholders. In the initial proposed model, all protocol fees will be sent to a smart contract where it will be divided:
- 70% to the Swapr Treasury;
- 30% to the SWPR Fee Share.
The SWPR Fee Share portion designates fees to ALL SWPR holders. The DXdao treasury will hold 50% of tokens at launch, resulting in 50% of the SWPR token fee share being delegated to the DXdao treasury. These allocations are subject to change and will ultimately be governed by the Swapr Guild.
Proposed Token Distribution
SWPR token will be a mainnet ERC20 token with a max supply of 100,000,000. These tokens will be minted to the DXdao treasury, and subsequent proposals will release the tokens to the specified allocations. It is worth noting that this thread should serve as a discussion of the tokenomics and that these percentages are suggestions from the Swapr Squad. Ultimately the initial distribution will be determined by the proposals following the minting.
The initial distribution is intended to:
- Increase visibility and bring more stakeholders into the Swapr ecosystem
- Bootstrap liquidity on Swapr
- Further engage those that have contributed to Swapr development
DXdao Treasury: 50%
The DXdao Treasury allocation is a large portion of tokens that distribute Swapr fees to DXD holders. Swapr is a product of DXdao. Its operations and development are supported through DXD holder funds, which make up the DXdao treasury. If both the Swapr Guild and DXdao identify a mutual benefit, these funds could be used in the future for new farming campaigns, partnership opportunities, Fast-exit liquidity, and more.
Swapr Treasury: 18%
The treasury allocation is designed to provide initial funds to the Swapr Guild to utilize as they see fit to operate. This includes any allocation of liquidity mining rewards, deployment to additional networks, and improvements to Swapr through bounties and contribution rewards.
Liquidity Incentives: 14%
Liquidity is the absolute most important facet to Swapr’s success. The liquidity incentives allocation will focus on distributing SWPR token fairly between several chains, prioritizing relevant pairs. You can read more on the initial liquidity mining campaign below.
DXD Holders: 8%
The DXD allocation will integrate an initial group of community members that already care for the success of Swapr through their commitment to DXdao. It also goes hand in hand with the above point: “Swapr is a product of DXdao. Its operations and development are supported through DXD holder funds, which make up the DXdao treasury”. The snapshot date for the DXD holders allocation is the 1st of July, 2021, and locked tokens will be vested for two years with a one year cliff. Additional information can be found in the Community Airdrops section.
- Locked (4% vested over 2 years with a one year cliff).
- Unlocked (4% unvested).
Swapr Builders 6%
The Swapr Builders allocation distributes SWPR token to those who were instrumental in Swapr’s development and future growth. This is accomplished through vesting that unlocks as milestones are achieved rather than a static timeframe, ensuring retention of important Swapr contributors.
- Swapr Builders (4% Vested and unlocked at milestones).
- DXdao Contributors (1% vested over 1 year).
- Active REP Holders (1% vested over 1 year).
Community Airdrops 4%
Community engagement is arguably of equal importance to liquidity, they go hand in hand. The Friendly Airdrop aims to attract users from relevant projects and spaces to integrate them in Swapr’s growing community. The included Airdrop Reserve is an undetermined allocation up for further discussion within the community.
The snapshot for the established Airdrops was taken on the 1st of July, 2021. The reserve will be up for discussion, and could have a separate snapshot date.
Initial Liquidity Mining Campaign
In this initial proposed configuration, each two-week Epoch will have a base issuance of 140,000 SWPR. These values are boosted up to 8x for the first 13 Epoch’s in order to kickstart liquidity and secure an initial distribution to individuals with an early commitment to Swapr.
SWPR token will have a multi-chain distribution targeting the upcoming Arbitrum launch. More specifically, the initial configuration points 50% of the issuance to the Arbitrum network, 30% to Mainnet Ethereum, and 20% to xDaichain. The allocation and distribution is subject to change and is ultimately decided by DXdao governance and eventually Swapr Guild governance.
The SWPR liquidity mining campaign targets distinct pairs with varying weights on each chain. This decision was made in an effort to distribute additional rewards to DXdao ecosystem pairs and incentivise a wide variety of chain-relevant pools:
- Blue - DXdao Ecosystem pairs
- Red - High volume competitive pairs
- Green - DeFi Ecosystem pairs
- Yellow - Awaiting further announcements/Not yet determined
The gradual reduction in issuance will facilitate SWPR token price discovery during its inception phase. Looking to the future, additional liquidity mining campaigns will be considered from the Swapr treasury or Community Reserve.
The above post has been prepared by the Swapr Squad and relevant Swapr community members. All aspects of this post are open to further discussion before moving to an on-chain vote; this is not an announcement. This process is expected to begin with an initial SWPR token minting proposal, and follow with distribution proposals dependent on the outcome of the discussion on DAOtalk.
Changelog 2021/08/02:
- Snapshot date changed from 1 June to 1 July on both DXD holder and community airdrop.
- Increased the minimum hold of xSDT minimum from 0.1 to 100 xSDT.
- Redistributed the remaining SWPR to the rest of the airdrop distribution.
The minimum before was 400 SWPR, now the minimum is 420 SWPR. - DXD holders airdrop will be a proportional airdrop. More DXD held during the snapshot = more SWPR airdropped.
- DXD holders airdrop will have a vesting of 2 years, with 1-year cliff.
