Preface:
Tapio Finance is seeking to serve as the middle layer between LST liquidity and downstream DeFi applications. By depositing LSTs and native ETH into Tapio’s pools, and minting tapETH - not only can users contribute to liquidity within the ecosystem, but also maintain the ability to take part within DeFi, while earning staking yield and swap and redemption fees.
Like many other protocols, Tapio Finance will also have it’s own dedicated token: $TAPIO. Keep in mind, since we’re here for the long term - we won’t be rushing our token launch and are placing a heavy emphasis on utility over simply emissions and bolstering APR in the short term.
The primary role of $TAPIO is to augment the utility of tapETH, and by extension, LSTs and ETH.
Token:
$TAPIO is the fundamental token of Tapio Finance and will be used (when locked) for protocol governance, for determining such things as fees, voting on gauges to allocate incentives towards specific DeFi projects and so on.
Continuing from this, $TAPIO will be used to incentivize usage of $tapETH within DeFi applications by directly emitting tokens towards downstream integrations. While we will most likely also incentivize our own liquidity early - our contribution to the ecosystem and utility of $tapETH is a far higher priority long term.
Fees collected by the treasury will be paid out to vote-lockers of $TAPIO in the form of $tapETH and $TAPIO, with an emphasis on the former.
Protocols can receive allocations or revenue based on their interactions (such as contributing TVL or routing swaps through Tapio's pools) in $TAPIO.
veTAPIO:
Tapio Finance will be utilizing a veToken model - where users will be able to lock their $TAPIO, with the longer the length of lock, the more $veTAPIO that’s received accordingly.
It’s by using this resulting $veTAPIO that will allow both users and protocols alike to vote on proposals that will determine certain things about Tapio Finance, such as which assets to integrate, and what weights each asset should have, or even the individual pricing curve our pools should have.
Furthermore, our governance will allow voting on, or “bribing” of gauges that associate with downstream DeFi applications - allowing for the allocation of $TAPIO emissions accordingly.
We will also experiment with the ability to lock $veTAPIO for additional yield for $tapETH holders and users, such that we have a usage flywheel, but one that prioritizes utility over APR for the long term.
Mechanics:
Unlike typical Curve-type emission models, rather than specifically incentivising the TVL of Tapio Finance itself, we instead prioritize incentives for downstream DeFi applications. How this manifests within governance is that users are able to vote or "bribe" specific gauges that represent $tapETH deposits within certain protocols.
For example, if we have Protocol A, Protocol B, and Protocol C - using veTAPIO, holders could vote that 50% of $TAPIO emissions are allocated to Protocol A, with the remaining 50% allocated between the remaining 2 gauges, as well as Tapio's treasury.
As such, if the emission schedule for $TAPIO was 100 tokens per block, 50 $TAPIO would be distributed to tapETH deposits within Protocol A (with the remaining distributed accordingly) meaning the APR/rewards would then be boosted by the included $TAPIO emissions.
Tokenomics:
This has yet to be finalized, but we’ll keep the community updated, so stay tuned!
Conclusion:
Our mission is to not only augment ETH's position as the most productive asset within crypto - but we also want to contribute and nurture an LST ecosystem through the use of meaningful incentivization, rather than prioritizing our own success and TVL.
Stay Updated
We want to work with anyone within the LST and LSTfi ecosystem, and we call on anyone invested in the long-term future of Ethereum and liquid staking, in general, to join us on this journey - follow us on Twitter and join the rest of the community on Discord, as well as our Blog.
Website: https://tapio.finance
Documentation: https://docs.tapio.finance
A rising tide lifts all boats - JFK