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ve-Mechanism & Utility

Please note that this content is about Tokenomics V1 and is provided for reference purposes only. For more detailed information, please refer to ExtraFi Tokenomics V2.

ve-Mechanism

Extra Finance uses two tokens to manage its utility and governance:
  • $EXTRA — ERC-20 utility token of the protocol
  • $veEXTRA — ERC-20 governance token of the protocol
$EXTRA is used for rewarding liquidity providers through emissions.
$veEXTRA is used for governance. Any $EXTRA holder can vote-escrow their tokens and receive a $veEXTRA in exchange.
The lock period (also known as vote-escrowed period, hence the ve prefix) can be up to 1 year (52 weeks), following the linear relationship shown below:
  • 100 $EXTRA locked for 52 weeks will become 100 $veEXTRA
  • 100 $EXTRA locked for 13 weeks will become 25 $veEXTRA
The longer the vesting time, the higher the voting power (voting weight) and rewards the $veEXTRA holder receives.

Governance

Vote & Governance in the Community.

$veEXTRAis the voting power in Extra Finance's on-chain governance process. Users could use it to initialize a proposal, or cast for/against community proposals.

Utility

By holding $veEXTRA, users can unlock the following benefits and features:

1. APR rewards, sourced from both protocol fees and $EXTRA token incentives.

The protocol fee comprises various tokens collected into the treasury and is shared once per epoch. It is used to buy back $EXTRA tokens from the market and then distribute them to holders of $veEXTRA tokens.
A portion of the $EXTRA tokens allocated to the community will also be assigned to $veEXTRA token holders, subject to a specific emission plan.
At the end of each epoch, rewards will be collected for distribution.

2. Unlock higher leverage for yield farming pools.

3. Gain access to lending pools with a high utilization rate.

Lending pools may experience high demand and potential shortages when implementing leverage farming. However, holders of $veEXTRA will have the privilege to borrow from these pools.

4. Priority to more coming features and benefits, including:

  • Advanced facilities including one-click position-rebalance tool.
  • Automatic strategy vaults.