🪙Explaning $veLARA
Everything about the vested LARA token
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Everything about the vested LARA token
As voted on by the Lara community in its first DAO proposal, $veLARA tokens have a maturity period of 6 months and a linear exchange rate. This simply means that from the moment you claim $veLARA tokens as a staking reward you need to wait 6 months to be able to redeem it 1:1 in the Lara Protocol. You can redeem it earlier too, but it will proportionally be worth less $LARA the quicker you redeem it. All $veLARA redeemed is instantly burnt.
Example:
Bob claimed 1000 $veLARA as staking rewards today. If he is:
redeeming them the next day, he's getting a very very small amount of $LARA for it.
redeeming them in 3 months, he's getting exactly 500 $LARA for it.
redeeming them in 6 months, he's getting the full 1000 $LARA for it.
redeeming after the 6 months have passed doesn't add a multiplier to the value, Bob will still get 1000 $LARA for his $veLARA.
The token is a vested version of the token. It serves as a way of locking supply and optimizing emission rates of the underlying token.
Through introducing $veLARA, we keep inflation and additional token emissions as low as possible.
$veLARA serves as a receipt for your future claimable $LARA.
Having vested staking rewards we're enforcing protocol usage by minimising negative price pressure.
Enhances the voting power of people who actively partake in the Lara Protocol.
Although you have full access to trade or transfer $veLARA tokens, they are not designed to be a freely tradeable asset with a secondary market in place.
When someone claims $veLARA tokens as staking rewards, only that address can redeem them for $LARA.
Example:
Bob staked 1000 $LARA and claimed 50 $veLARA as staking rewards. Then, Alice buys the 50 $veLARA from Bob and then tries to redeem $LARA tokens for it. Alice will fail redeeming because Bob is the only one that can exchange those 50 $veLARA tokens for $LARA.
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