preLVL Unvested Token
preLVL = unvested LVL token
LVL Bonding Mechanism - preLVL
With Level 2.0 a Bonding Mechanism (LIP #23) was implemented with an unvested token called preLVL. All LVL rewards are no longer distributed directly.
As part of the the 2023 roadmap and LIP #23, LEVEL introduced preLVL.
LEVEL will no longer distribute LVL incentives directly to traders or liquidity providers, as rewards will be in an unvested version called preLVL.
Users will have 2 choices to vest preLVL tokens: Normal or Accelerated vesting
How to vest preLVL tokens
Normal vesting using LVL:
Users may stake and lock LVL tokens in order to vest preLVL tokens.
To vest 1 preLVL token into 1 LVL, users will be required to stake 10 LVL tokens for 1 year. Users can claim vested LVL, stop vesting and/or unstake at any time.
Example: If a user wants to vest 10 preLVL tokens, that user is required to stake 100 LVL tokens for 1 year.
Normal vesting using LVL/USDT LP:
Users may also stake and lock LVL/USDT LP in order to vest preLVL tokens. This option has a 2.5 times higher rate than using a single LVL token for normal vesting.
Example: If a user wants to vest 10 preLVL tokens, that user is required to stake a LVL/USDT LP with 40 LVL tokens within the LP for 1 year.
Accelerated vesting:
Users may pay fees in USDT in order to vest and receive preLVL immediately.
To vest and claim 1 preLVL token immediately, users will need to pay a 60% tax in USDT.
Assuming that $LVL is $3, users would then need to pay 1.80 USDT to immediately realize the conversion. The taxed USDT will be distributed equally, with 50% to the DAO, and 50% to the LLP.
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