Liquidity Mining Rewards (LMR) & Game Playing Rewards (GPR) of REDC Tokens
Scenario:
Out of 600k REDC token allocated for exchanges, only 306k REDC tokens are in market circulation (Zilswap).
Total REDC left to be circulated in market = 294k REDC
Problem:
This amount of REDC needs to be provided in market as soon as possible but team lacks proper funding to provide liquidity of this high scale when 1 REDC >= 25 ZIL .
Proposals:
Solution A: Convert rewards to provide liquidity slowly.
Solution B: Collaboration with another exchange for market making.
Solution C: Provide rewards to gamers & liquidity providers.
Solution D: Raise private fund.
Voting results:
Solution A: 17% -> LP rewards are low; and dependency over ZWAP makes inconsistency if failed to qualify in Lightning program. Hence this fails.
Solution B: 24% -> This takes longer time and may not be feasible until REDC gains strong adoption.
Solution C: 48% -> Best solution for now to grow liquidity and game players.
Solution D: 11% -> Bad solution in this early stage of project
Implementation of Solution C:
As decided by community vote, we will be implementing solution “C”. There will be two sets of pool for rewards:
A) Liquidity Mining Rewards (LMR) in Zilswap: Makes price of REDC stable to attract HODLERS/Investors.
B) Game Playing Rewards (GPR) in Zilchill platform: Motivates to host/play more games.
294k REDC will be circulated in these two pools weekly in a ratio of 60:40 with total 2020 REDC in each cycle. This will make this circulation to last 3 years and 1 week period. The token distribution will happen every Wednesday 3:00 am EST [this might be synced in Zilswap platform with ZWAP reward epoch].
One cycle = Wednesday 3:00 am to next Wednesday 3:00 am = 1 week cycle [this will change if LMR gets integrated in Zilswap application]
Liquidity Provider will share 1,212 REDC as LMR reward weekly based on % of share in liquidity pool weighted over time period.
Calculation
When a new liquidity provider adds liquidity to REDC-ZIL pool, the ownership of the pool is calculated in terms of pool units ownership. If a LP has 1.5% pool ownership, he/she is rewarded 1.5% of 1,212 REDC on the reward cycle weighted over time period of that cycle.
Note: This logic is synced with ZWAP reward calculation in an effort to integrate the LMR into native Zilswap platform. In case of no integration or delay, manual snapshot data of “Add Liquidity” & “Remove Liquidity” will be maintained until we develop another system.
REDC Treasury will receive 808 REDC as GPR reward weekly and share among Host, Players, Developers & Governors based on Leaderboard rules.
Distribution of REDC Treasury is on monthly basis. Hence the total REDC distributed from Treasury will be calculated as:
Monthly Treasury Distribution = 2 REDC * No. Of Games Played in last month + 808 REDC * No. Of weeks in last month
Since the reward has increased dramatically in Leaderboard, the receiving population will be increased to 100 with Bet Games. When new games are launched, the receiving population will be again increased. Example: when Ludo Dice gets released, there will be separate category in Leaderboard for Ludo Dice related gamers. Hence, the Leaderboard population keeps increasing with addition of new games.
Approximately per month if there are 100 games in initial stage and 4 Wednesdays in a month,
Total REDC in Leaderboard Wallet from Treasury for that month
= 2*100 + 808*4 = 3,432 REDC
This amount of monthly reward will be distributed to initial 100 wallets as:
A) Top 40 players on loyalty points
[Universal across all games — population might change]
1:1 with ZIL bets -> 40% = 1,372.8
B) Top 40 host on loyalty points
[Universal across all games — population might change]
1:1 with REDC Host fee -> 40% = 1,372.8
C) Highest Better of the Month [Bet Games Related Only]
-> Can’t be Top 1 player -> 2.5% = 85.8
D) Biggest Winner of the Month [Bet Games Related Only]
-> Can’t be Top 1 player -> 2.5% = 85.8
E) Most Active Player of the Month
[Universal across all games — population won’t change]
-> 2.5% = 85.8
F) Random airdrop to 7 players
[Universal across all games — population might change]
-> Can’t be in any other category -> Equal distribution -> 2.5% = 85.8
G) Governor of the month + Developers of the month — nominated & voted under Top 10 rank
[Universal across all games — population won’t change]
-> 10% = 343.2
- If any category misses any recipients, funds will move to Reward Wallet to re-circulate into per games basis.
- In future the population of receiving rewards increases with the addition of new games.
How does Top 10 or Top 40 receive REDC?
Based on ranking, each rank will receive different percentage of REDC rewards.
Timeline
LMR and GPR begins by 7th April, 2021 at 3:00 am EST.
First LMR distribution is scheduled on 14th April, 2021 at 3:00 am EST for all Liquidity Providers of April 7th to April 14th period. While first GPR distribution is scheduled on 1st May, 2021 for all games of March 12 to April 30 period.
Impacts & Aftermath
The goal of LMR is to bring stability in price of token which will benefit all holders and investors.
The goal of GPR is to bring more game hosts, players, developers and governors which will benefit all zilchill ecosystem.
When more liquidity providers join the REDC-ZIL pool in Zilswap, APY is expected to decrease overtime. Hence a competitive market will sustain the growth value of REDC token.
When more games are added, Leaderboard category and population will increase. This will increase recipients but single individual reward amount will become lesser over time. Hence a competitive market will sustain the growth value of REDC token.
All 294k REDC will be circulated in market within 3 years & 1 week of this program. At the end of this program, RedChillies token is expected to have less volatile market prices with strong user adoption in gaming platform. Hence, the normal game reward and leaderboard reward are expected to make the platform sustainable afterwards.
