003 - Earnable TRAX

Proposal Summary: TRAX token should be paid to the farmers of Contrax by a campaign awarding 1 TRAX token per day per $100 staked by users, and allow accounts referral links to earn 10% of staked rewards by other users.

Details: The TRAX token should be earnable on the Contrax platform through usage. Since farming is the main function of the platform, farmers should earn their share of the platform in the form of TRAX tokens.

Given a 700m supply, TRAX tokens should be earned by stakers on the platform based on their TVL. I suggest a distribution campaign at the distribution rate of 1 TRAX token per $100 TVL provided per day. The suggested length of this initial distribution campaign is 180 days, with a 2x multiplier for each user once they have staked for 90 days. Since earning is tied to amount and time, it cannot be exploited via multiple wallets or timed large deposits.

Additionally, users can earn TRAX via referrals in the following way: For every wallet that is either created (social login) or first interacts with Contrax after they have clicked a referral link, the referring account is associated with it. Afterwards, TRAX is also awarded to the referring account at a rate of 10% of the staking account. This does not cascade down to referrals of referrals, nor are each wallet’s own referral rewards ever shared to referring wallets. This is a straightforward referral system where the maximum amount of referred tokens paid out can only ever equal 10% of the rewards paid to stakers.

Here is a sheet where the calculations for the distributions can be seen, given assumptions such as distribution rate, campaign length, multiplier days and amount, user count, and staking amount. An arbitrary assumed price of the token is also an option just to see how numbers would translate to a price. Given my assumptions, this method would distribute just over 4% of TRAX over the next four months. The first tab of the sheet cannot be edited but there are copies in other tabs called “playgrounds” where anyone can go to and change all the assumptions, and see the changes:

https://docs.google.com/spreadsheets/d/1ixxOQnFgTojB1e1gKmawF1uKF_JtwOpz67iN1Tx5Z1s/edit#gid=351219528

Important note for consideration: Both the token earning at 1 token per 100 TRAX per day and the referral rewards at 10% are all developed and tested, but are not currently showing because they are hidden behind a feature flag. It should also be noted that the creation of the non-transferrable token and setting up the smart contract to have these rewards all earned on-chain has been offered by Capx.fi.

Finally, although not part of this proposal, assuming one time transferability (proposal 2), the timeframe of this distribution campaign can allow the DAO to agree on more detailed tokenomics and then set them into motion by making the token transferrable at the end of the campaign.