The Ladder runs continuously and is implemented to scale LVL incentives with trading volume on the platform. This incentivization of trader activity establishes a flywheel effect driving increased trading volume and fees at LEVEL. Ladder rewards are only distributed to the top 20 traders on a leaderboard, based on a trader’s trading volume of leverage contribution.
Each ladder runs for one epoch (7 days), starting at 2pm UTC every Wednesday. LVL incentives distributed for the Ladder are based on the total trading volume generated by traders at LEVEL per epoch. The amount is capped at 200,000 preLVL per epoch.
A baseline reward of 20,000 preLVL rewards are allocated to the rewards for the epoch. Additional rewards are allocated at $50,000,000 trading volume hurdles as revenue is collected throughout the epoch. Each of the hurdles reached corresponds to an additional 20,000 preLVL rewards.
- Level 0: Trading Volume = $0.00 → 20,000 preLVL rewards
- Level 1: Trading Volume = $50,000,000 → additional 20,000 preLVL rewards
- Level 2: Trading Volume = $100,000,000 → additional 20,000 preLVL rewards
Whenever you generate trading volume through Leverage Trading actions, you automatically earn Ladder Points. Ladder Points are only assigned for generating trading volume on the trading platform, through the following actions:
- Opening or increasing the size of a Leverage Trade position
- Closing or decreasing the size of a Leverage Trade position
- Having your Leverage Trade position liquidated
After each weekly Ladder period, only the top 20 traders in the leaderboard will be awarded preLVL tokens. A trader’s ranking on the leaderboard is based on their amount of Earned Points.
- Earned Points are calculated based on a trader’s trading volume contribution to the protocol
Current Earned Points formula:Earned Points = Trader Volume Contribution
preLVL rewards distributed to traders who achieved a top 20 spot are determined based on their ranking within the leaderboard. The table below shows the weighting of rewards distributed amongst the top 20 traders.
preLVL (per trader) = Total preLVL Rewards * Reward weight (trader ranking) / Total Reward weight
A trader contributes $1,000 in trading volume in the week-long Ladder period. As a result, they would have 1,000 Earned Points throughout the week and placed 10th on the leaderboard. From the table above, 10th place corresponds to 2.27% of the total rewards for the Ladder. If the total trading volume contributed to the platform each week were $50,000,000, then Level 1 would have been reached, equating to 40,000 in preLVL rewards for the epoch. As a result, the trader would have received 908 preLVL for this particular weekly Ladder.
preLVL (per trader) = 40,000 preLVL * 0.0227 = 908 preLVL