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.
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.
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.
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.