KIP-3: Kwenta Staking Mechanism

Summary

This proposal outlines a staking mechanism for the Kwenta DAO.

Abstract

The Kwenta staking system will have two primary functions:

1. Governance: staked KWENTA will gain voting power within the system enabling stakers to vote in elections and CKIPs offering the protocol a decentralized decision making mechanism.
2. Protocol Rewards: Staked KWENTA will earn inflationary rewards. This mechanism will empower members dedicated to the protocol to increase their influence over decision making. Additionally, staked wallets that have trading activity will earn additional rewards in an effort to place active Kwenta users at the center of decision making.

Motivation

Having a decentralized decision making process is crucial for an unstoppable protocol. After examining the success of the decision making processes in protocols such as Synthetix and Yearn, we designed a mechanism that not only distributes decision making across community members but also adequately incentivizes them to continue to make decisions that are beneficial for the protocol.

Specification

For full details, visit: https://kips.kwenta.io/kips/kip-3/