Summary

This proposal upgrades the existing Loyalty Program from a monthly rebate system to a seasonal, points-based program that is more scalable, more predictable, and more aligned with long-term ODOS token utility.

The new structure eliminates monthly emissions, broadens participation across new Odos features and chains (including Solana), and builds a durable incentive engine designed to increase usage, retention, and token utility.

Motivation

Current Issues With Loyalty Program 1.0

1. Monthly emissions create recurring market friction:

   The current model delivers ODOS rewards every 30 days, which results in:

   • Short-term incentive cycles
   • A recurring pattern of claim-and-exit behavior
   • Operational overhead and delay in calculating and distributing emissions

2. Rewards are tied to monthly revenue, which is volatile:

   As fee revenue fluctuates, reward emissions become inconsistent, unpredictable, and often too small to meaningfully engage users

3. Lower tiers churn quickly, higher tiers dominate usage.

   Based on 9 full epochs since January 1, 2025:

   • Lower tiers show minimal retention and mostly farm short-term rewards
   • Higher tiers remain stable and aligned with long-term benefits
   • The program has a pronounced whale concentration effect, which is desirable but currently limited in scale

4. Introduction of fees changed user behavior as expected.

   Since launching fees:

   • Active wallets: ~50% decline
   • Total transactions: ~50% decline
   • Average trade size: ~70% increase

   Meaning the loyalty mechanism correctly retained high-value traders but now requires a structure that encourages consistent long-term usage, not monthly competition

5. Monthly epochs prevent long-term holding and alignment.

   Short epochs produce:

   • “Sprint” behavior
   • Almost no progression between tiers
   • No buildup of long-term loyalty
   • No token holding incentive beyond month-end snapshots

Goals of the Loyalty Program 2.0

Token-Economic Goals

• Stop introducing new tokens into the market monthly
• Increase token utility
• Strengthen ODOS FDV without requiring immediate buybacks
• Create predictable, capped annual token distributions

User & Product Goals

• Grow usage on EVM and new chains
• Build strong long-term user retention & progression
• Reward trading, loyalty, feature adoption, and partner activity
• Eliminate churn, boost advanced feature usage, and incentivize cross-chain behavior

Strategic Goals

• Turn Loyalty from a cost center into a growth engine
• Allow the program to expand to future activities (staking, vaults, partner campaigns)
• Create a system that becomes an ongoing marketing asset rather than an operational liability

Overview of Loyalty Program 2.0

Under Loyalty 2.0, Odos can introduce an annual (or semi annual) season where users earn in-platform points (non-transferable, non-token, off-chain points) used to determine a user’s share of annual ODOS rewards.

Odos Points may be earned for a wide range of possible actions (examples only):

• Trades on Odos dApp
• Higher-value swaps
• High-frequency usage
• Cross-chain swaps
• Usage during peak campaign periods
• Trying new advanced features
• Participation in chain-specific campaigns
• Using Odos via API partners
• Referral bonuses
• Partner integrations (wallets, dApps, tooling)
• Holding ODOS during entire season
• Maintaining multi-month active streaks
• Operating across multiple chains
• Returning after inactivity (“comeback bonus”)

At the end of each annual season, a fixed ODOS reward pool is distributed proportionally based on:

1. Points earned
2. User tier
3. Seasonal achievements (badges, streaks, multipliers)
4. Market Conditions

Request to the DAO

1. Approve replacing the monthly Loyalty Program with the annual, seasonal Odos Points program.
2. Approve discontinuing monthly rebate emissions immediately prior to Epoch 1 (January 1, 2026) launch.
3. Approve expansion of program scope beyond trading to feature usage, and partner activity.

If this proposal passes, Loyalty Program 2.0 begins with Season 1 starting Q1 2026.