Pylon Protocol
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Pylon Token ($MINE)
MINE is the native governance token for Pylon Protocol. As with Pylon's namesake, MINE is inspired by "minerals" in StarCraft.
A portion of all yields generated across all forthcoming platforms and projects launching on Pylon Protocol and its suite of products, including Pylon Gateway, are captured by the Pylon Treasury. MINE stakers are able to govern in a decentralized fashion the initial distribution parameters and further use cases of the Pylon Treasury.
Token Utility
The most prominent functionality of MINE is to allow holders to govern the underlying protocol via the Pylon WebApp. Users can deposit MINE to create governance polls, while MINE stakers can vote on community fund grants, protocol updates, launchpad projects, parameter changes, new features development, treasury distribution, and other ecosystem expansion initiatives.
Via the Pylon Treasury, MINE is designed to capture a portion of yields and transactions generated across all Pylon platforms and project launches on Pylon Gateway, such that MINE holders directly benefit from the growth of Pylon Protocol's total value locked (TVL).
Currently, as per Governance Poll #8 to lay out an initial distribution of the Pylon Treasury, the accrued yield reserve is distributed as follows:
- 1.25% for weekly MINE token buybacks at market prices to be linearly distributed to stakers
- 2.25% for providing additional liquidity to the MINE-UST pair, with LP rewards being linearly distributed to stakers
- 3.50% being stored as aUST in Anchor Protocol, with further storage and use cases for the UST being governed by stakers
MINE buybacks and rewards generated from the MINE-UST LP pair are linearly distributed as staking rewards to MINE stakers in proportion to each staker's percentage of total stake in the governance pool. This process creates buying pressure against the generation of new MINE tokens, supports long-term price stability and value growth, and allows Pylon to share transaction fee revenues with ecosystem participants.
MINE provides incentives to active community members on Pylon Gateway, that is, users and project teams, as well as for secondary platforms that are building service offerings integrating Pylon via proposals submitted to the community fund. Liquidity providers to the MINE-UST LP pair also receive MINE as passive income.
Value Accrual
Pylon captures a portion of total protocol assets under management (AUM) with the MINE token. A percentage of interests and revenues generated across all Pylon projects and platforms will be captured in the Pylon Treasury, governed by MINE stakers. For Pylon Gateway, the platform fee will be 20% of all yields generated.
Yields collected in TerraUSD are used in various cases to generate value for MINE stakers, including buybacks and protocol-owned liquidity.
The parameters of the yield accrual mechanism can be changed in the future through the governance process. Holders of MINE are incentivized to propose, discuss, and vote for proposals that further merit the protocol.
MINE doubles as an incentives mechanism to bootstrap depositor demand and project launch incentives for platforms and projects that build on Pylon. Active ecosystem participants are awarded with MINE for their participation. These activities may include:
- users making deposits into selected projects on Pylon Gateway and other Pylon platforms
- projects launching tokens on Pylon Gateway
- platforms building service offerings that integrate with Pylon's "Deposit with Pylon" widget
- liquidity providers of the MINE-UST pair on various decentralized exchanges on Terra
On top of MINE rewards, MINE stakers may receive additional real-time project token airdrops, NFT airdrops, and additional token rewards and early access perks on Pylon Gateway.
The latest proposal for Pylon Funds on Pylon Gateway, will introduce a deflationary mechanics by requiring user-depositors to burn MINE in order to deposit into particular pools.
Governance
MINE stakers can exercise voting rights over protocol upgrades, parameter changes, community grants, and text proposals on Pylon's decentralized governance platform. Voting power for users is proportional to the amount of MINE staked.
Any proposal implementation or community fund use will be implemented only if it is clearly by the will of the community, that is, a passing vote by quorum.
MINE token deposits for Pylon governance polls that have failed to reach the required quorum will be sent back to MINE stakers as staking rewards.
Token Supply
The hard cap of circulating MINE token supply will be fixed at 10,000,000,000 MINE, which is scheduled for distribution over a period of at least 4 years. Beyond that, there will be no more MINE tokens introduced to the supply.
Annual inflation rate of MINE tokens is designed to gradually decrease every year, until MINE eventually reaches a maximum capped supply of 10B.
Genesis Token Distribution
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A total of 2,500,000,000 MINE tokens are released at the genesis of Pylon Protocol. The initial distribution of MINE will be as follows:
- Pylon Launchpad: 400M (16%) tokens will be distributed in early "deposit to earn" farming pools for community investors on Pylon Gateway, Terra's premier project launchpad.
- LUNA Staking Airdrop: 500M (20%) tokens will be airdropped to LUNA stakers, with the snapshot taken on the date of launch.
- Community Fund: 1,600M (64%) will be allocated to the community pool, governed by MINE stakers. At least 100M tokens will be reserved for bootstrapping initial project pipeline on Pylon Gateway, early user onboarding, or growth round fundraising as needed.
Final Token Distribution
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Further MINE tokens are set to be released over a period of at least 4 years, increasing total supply until it reaches 10B. The final distribution structure will be:
- Pylon Launchpad: 400M (4%) tokens will be distributed to early MINE investors over vesting periods of 6 months, 12 months, and 18 months.
- Genesis Airdrop for LUNA Stakers: 500M (5%) tokens are airdropped to LUNA stakers on launch.
- Weekly Airdrops for LUNA Stakers: 1,000M (10%) tokens are linearly distributed to LUNA stakers over a period of 2 years. Tokens will be distributed every 100,000 blocks (approximately every week). Snapshots are taken every 100,000 blocks to determine distribution eligibility.
- [Update as of Dec 09, 2021] As with the latest Governance Poll #4, weekly MINE airdrops for LUNA stakers are no longer active. The remainder of the MINE allocation reserved for airdrops for LUNA stakers have been redirected to the Pylon Treasury.
- Depositor Incentives: 4,000M (40%) tokens are linearly released to be used for depositor incentives and to reward ecosystem participation over a period of 4 years.
- Community Fund: 1,600M (16%) tokens will be reserved for the Pylon Community Fund.
- Team Reserve: 1,000M (10%) tokens will be vested over 3 years to the core Pylon team, following a 1 year lockup period.
- MINE LP Staking Rewards: 1,500M (15%) tokens are distributed to the MINE-UST pair liquidity providers over a period of 4 years.
Distribution to Ecosystem Participants
MINE tokens allocated for depositor incentives are gradually distributed to depositors (users), creators, and platforms, including projects teams and investors on Pylon Launchpad, as well as other ecosystem participants on forthcoming Pylon-powered platforms.
MINE aims to fuel a reinforcing adoption cycle, incentivizing more projects to integrate the Pylon SDK and more depositors to stake UST.
Distribution to MINE Liquidity Providers
High exchange liquidity for MINE is crucial for maintaining a constant incentive flow across all platforms. To incentivize initial exchange liquidity of MINE, newly minted MINE is distributed to liquidity providers, specifically via the fMINE-UST pair. MINE tokens are distributed as part of staking rewards for LP token holders of the MINE-UST pair.
Last modified 10d ago