Abstract

Equilibria has aimed to be community-focused since day one and has aimed to take all necessary steps for our protocol to truly become a community-driven structure. This transformation and development must be carried out as carefully as possible to not jeopardize the success of our protocol. However, the participation of the Equilibria community in decision-making processes has pleased us regardless of the outcome of our proposal.

The ePENDLE Peg is crucial to the Equilibria ecosystem. With a healthier peg, there will be more PENDLE inflow to Equilibria through future PENDLE Campaigns. By accumulating more PENDLE on Equilibria, it will bring benefits to ePENDLE holders, vlEQB holders, and liquidity providers. Therefore, we are committed to continually making improvements in collaboration with our community to enhance ePENDLE.

Motivation

This proposal will replace EIP#1 and allow the ePENDLE obtained through buy-back to be used in a more sustainable manner.

Specification

The current mechanism implemented with EIP#1 is as follows:

• 12.5% to ePENDLE stakers;
• 5% to vlEQB holders;
• 2.5% (originally to vlEQB holders) and 2.5% (originally to Treasury) are reserved for ePENDLE Buyback Program. In return, the procured ePENDLE are used to bribe vlEQB holders.

With the acceptance and implementation of EIP#4, the new mechanism will be applied as follows:

• xePENDLE will have a vesting period ranging from 1 to 25 weeks. For each week of vesting, the total xePENDLE included in the vesting will earn a 4% entitlement. For example, if you vest 100 xePENDLE for 2 weeks, it will provide the user with an 8% allocation. At the end of 2 weeks, the user can claim 8 ePENDLE.
• 10% of the obtained ePENDLE will be burned, removing it from circulation. 90% of the obtained ePENDLE will be converted to xePENDLE and allocated to protocol users according to the following points.
• 50% of xePENDLE will be used to incentivize the ePENDLE liquidity pool on Camelot.
• The remaining 50% of xePENDLE will be offered as an incentive reward to vlEQB holders for voting in the ePENDLE (Pendle) Boosted pool, contributing to PENDLE emission gains.
• For the remaining ePENDLE from short-term vesting (abandoned by users) will be burned.

Let's clarify the proposal details with an example for better understanding:

• Buy-Back ePENDLE amount: 1,000 ePENDLE
• Amount Burned: 100 ePENDLE
• Distributed ePENDLE (xePENDLE): 900 xePENDLE (450 xePENDLE for Camelot, 450 xePENDLE for vlEQB voters)

Assuming a user vests 100 xePENDLE over 10 weeks. With this vesting, the user will earn a 40% allocation, meaning they will receive 40 ePENDLE after 10 weeks. The remaining 60 ePENDLE will be utilized as follows:

100% (in this case, 60 ePENDLE) will be burned, removing it from circulation.