Neptune's Governance Token (veNEP)

• Token Name: Neptune's Governance Token

• Ticker: veNEP

• Type: ERC-721 token represented as an NFT (non-fungible token).

• Blockchain: Swellchain.

• Purpose: veNEP serves as the governance token for Neptune, enabling holders to participate in protocol decision-making.

1. How to obtain veNEP?

NEP holders can obtain veNEP by vote-escrowing their tokens, which are then converted into a veNEP (also referred to as Lock or veNFT). Additional NEP tokens can be added to an existing veNFT at any time.

The locking period (or vote-escrow period, giving rise to the "ve" prefix) can be up to 2 years, with the voting power determined linearly:

• Lock 100 NEP for 2 years → Receive 100 veNEP

• Lock 100 NEP for 1 year → Receive 50 veNEP

Longer lock durations grant higher voting power (voting weight) for the locked balance.

Auto-Max Lock Feature

Neptune Locks (veNFTs) can be set to Auto-Max Lock, which the protocol treats as being locked for the maximum duration of 2 years. These veNFTs maintain their full voting power without decay. The Auto-Max Lock feature can be toggled on or off for each Lock.

2. veNEP Utilities:

The ve(3,3) token provides holders with several key benefits:

• Voting Power: Holders can vote weekly on gauges, which determine emission distributions.

• Fee Sharing: Access a significant portion of trading fees and all associated pool incentives.

• Liquidity Incentives: Liquidity Providers receive their share of protocol token emissions.

• Governance Participation: Token holders can vote on protocol improvement proposals, shaping the future of the protocol.

This structure creates a robust utility model, encouraging active participation, rewarding contributions, and fostering the protocol’s growth and development.

3. Rebase Mechanism for veNEP holders

veNEP token holders benefit from a rebase mechanism designed to mitigate vote power dilution and incentivize locking. Rebases are proportional to NEP emissions and the ratio of veNEP supply to total NEP supply.

The rebase amount is calculated using the formula:

$$Rebase = weeklyEmissions * (1-veNEP.totalSupply/NEP.totalSupply)^{2}*0.5$$

Key Highlights:

• Rebases reward veNEP holders most when the locking rate decreases, encouraging new participants to lock tokens.

• The total veNEP supply does not impact the emissions distributed to liquidity providers.

This structured approach ensures an equitable and sustainable token distribution model while empowering veNEP holders with governance and rewards.