$ELTK Liquidity Mining Strategy

The Elektrik protocol employs a hybrid model for liquidity mining incentives, utilizing a fixed emission approach for the initial six months, followed by emissions proportional to network activity. During the first six months, tokens are evenly distributed in each epoch to incentivize users. After this period, emissions are determined based on network metrics like TVL and volume at the start of each weekly epoch, striking a balance between meaningful participation and prevention of exploitation while staying responsive to market fluctuations.

To encourage liquidity stickiness, users must lock their LP tokens for a specific period to receive emissions allocated to that pool. The emission distribution among LPs and $veELTK holders is subject to a rebase, accounting for inflation in voting power.

$$\text{Emissions per Epoch}=\text{Allocated Emissions per Epoch}-\text{Rebase Amount}$$

The proportion of emissions a pool receives is directly related to the total votes it receives in that epoch, while the LP's share of emissions is influenced by the amount of liquidity locked and the duration of the lockup. Longer lockups yield a greater share of emissions per epoch.

$$\text{Share per Epoch}=\text{Emissions per Epoch}\times\left(\frac{\text{poolVotes(\$veELTK)}}{\text{total Votes(\$veELTK)}}\right)$$

$$\text{LP Share}=\left(\frac{\text{amountLocked}\cdot\text{time Until Unlock}}{\text{totalLocked }\cdot\text{total Time Until Unlock}}\right)$$

The utilization of this unique model ensures a balanced approach to incentivizing liquidity providers, promoting participation while managing centralization risks, and fostering the growth of the Elektrik ecosystem.