[VIP-39] Adjust governance quorum and voting power for VCX, stVCX, and veVCX

VaultCraft Improvement Proposals
1
  • Yes
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Summary:
This proposal aims to modify the voting power structure for VCX tokens on snapshot.org to better align incentives, encourage long-term staking, and reward active participation in the VaultCraft ecosystem. The proposed changes are:

  • Maintain 1x voting power for regular VCX tokens
  • Increase voting power to 4x for staked VCX tokens
  • Implement 50x voting power for vote-escrowed VCX (There is roughly 7 VCX tokens required per 1 80 VCX 20 WETH LP token and a 4 year lock required for a 1:1 veVCX to VCX LP, thus the large multiplier)

Quorum is proposed to be adjusted to 10,000,000 VCX

Value Proposition:

  1. Incentivize long-term holding and staking of VCX tokens, promoting price stability and reducing sell pressure.
  2. Reward users who actively participate in the VaultCraft ecosystem by providing liquidity and locking tokens.
  3. Enhance governance participation by giving more voting power to committed stakeholders.
  4. Align voting power with the level of commitment and risk taken by token holders.
  5. Encourage a more engaged and informed community of governance participants.

Implementation:

  1. VCX
  • Maintain the current 1x voting power for unstaked VCX tokens.
  1. Staked VCX
  • Implement a 2x voting power multiplier for VCX tokens staked in designated smart contracts.
  • Develop a staking mechanism that allows users to lock their VCX for a minimum period of 3 months to qualify for the 2x multiplier.
  1. Vote-escrowed VCX (veVCX)
  • Implement a 3x voting power multiplier for veVCX.
  • Utilize the existing Balancer 80VCX-20WETH LP token lock mechanism for obtaining veVCX.
  • Maintain the current veVCX lock duration options (1 year = 0.25 veVCX, 2 years = 0.5 veVCX, 4 years = 1.0 veVCX).
  1. Snapshot.org Integration:
  • Update the snapshot.org strategy to incorporate the new voting power structure.
  • Implement on-chain tracking of staked VCX and veVCX balances to accurately calculate voting power.
  1. Smart Contract Upgrades
  • None necessary.
  1. Community Education
  • Communicate to he community about the new voting power structure and its benefits.

Conclusion:
By implementing this tiered voting power structure, we aim to create a more engaged and committed VaultCraft community. This proposal rewards long-term holders and active participants in the ecosystem, aligning incentives and potentially leading to more informed governance decisions. The increased voting power for staked and vote-escrowed VCX encourages users to lock up their tokens, potentially reducing sell pressure and promoting price stability.This new structure also maintains a balance by still allowing regular VCX holders to participate in governance, while giving additional weight to those who demonstrate a stronger commitment to the protocol. As VaultCraft continues to grow, this enhanced governance model will help ensure that those most invested in the protocol’s success have a proportionally stronger voice in its future direction.

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