zLP Staking

The Liquidity Provision model for $ZERO is specifically designed for users who contribute to liquidity pools. When users stake zLP tokens, their $ZERO portion is effectively doubled in value for staking purposes.

Enhanced Weighting for $ZERO

A distinctive feature of the zLP ve-staking model is the enhanced weighting given to $ZERO tokens at the time of staking. When calculating the value of a user's contribution to the liquidity pool, the $ZERO component is effectively considered to double its presence in the pool.

Example: If a user's liquidity pool token consists of 50% $ZERO and 50% $ETH, the weighting mechanism acknowledges the $ZERO component as if it were 100% of the contribution.

When staking is locked, the zLP weighting for $ZERO is counted as double its amount in the liquidity pool token.

Calculation Method

$veZERO earned is the product of the quantity of zLP tokens staked and a locking factor LzLPL_{zLP}. As mentioned already, $ZERO tokens in the zLP stake are given double weight. Hence, (2Ɨ$ZERO) (2 \times \$\textrm{ZERO}).

$veZERO=zLPƗLzLP\$\textrm{veZERO} = zLP \times L_{zLP}
$veZERO=(2Ɨ$ZERO2)ƗLzLP \$\textrm{veZERO} = (2 \times \$\textrm{ZERO}_2) \times L_{zLP}

Time-Locking Coefficients

Another distinctive feature of the zLP ve-staking model is time-locking coefficients. ZeroLend modifies the time-locking coefficients for zLP stakes to suit the unique risk profile of liquidity pool tokens. The following is the time scale for zLP:

Time LockL_dLP - Value

1-Months

0.0625

3-Months

0.25

6-Months

0.5

12-Months

1.0

This adjusted time scale reflects the nuanced differences in risk profile compared to staking single assets.

Practical Example

A user staking 10,000 zLP tokens, split into 5,000 $ZERO and an equal value of $ETH for a 6-month period, will be allocated 5,000 $veZERO.

The formula for $veZERO Allocation:

The total $veZERO a user receives is determined by:

$veZERO=$ZEROƗLZERO+zLPƗLzLP\$\textrm{veZERO} = \$\textrm{ZERO} \times L_{ZERO} + zLP \times L_{zLP}

In this equation:

  • LZEROL_{ZERO} and LzLPL_{zLP} represent the time-locking coefficients for single-asset $ZERO and zLP stakes, respectively.

  • zLPzLP is valued as twice the amount of $ZERO present at the time of staking.

To clarify, the formula accounts for the different quantities of $ZERO in single and dLP stakes:

$veZERO=$ZERO1ƗLZERO+(2Ɨ$ZERO2)ƗLzLP\$\textrm{veZERO} = \$\textrm{ZERO}_1 \times L_{ZERO} + (2 \times \$\textrm{ZERO}_2) \times L_{zLP}

Here, $ZERO1\$\textrm{ZERO}_1 and $ZERO2\$\textrm{ZERO}_2 denote the respective amounts of $ZERO in single staking and within the zLP.

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