Dear Community,
Following SpiderDAO’s successful sale in December, the team has been busy executing against our roadmap with some significant milestones reached, including the distribution of the initial batch of SpiderConnect Routers, the launch of “Liquidity as Utility” (LAU), and several other exciting announcements to come in due course.
However, we are also aware that interactions will be needed along the way as we continue to develop the SpiderDAO ecosystem and appreciate your feedback.
In the past few weeks, we have listened to the community, who have rightly raised the concern, that the high APY currently provided to liquidity miners, while attractive on the surface, is creating a significant amount of token emissions and subsequent downward pressure on the token price.
The liquidity mining program intends to distribute the SPDR token equitably across our community as the ecosystem grows and rewarding early supporters. But we also recognize that perhaps we haven’t done enough to incentivize loyal supporters who wish to hold SPDR tokens on a longer-term basis and pro-actively participate in the community and utilize SpiderDAO services outside of the liquidity mining program.
To address this, we have come up with a new feature that we believe will provide choice — benefiting the early supporters of the SPDR token and enabling the distribution of the SPDR token to a broader community of users in a more sustainable way.
The solution is to create Spider Nests, a staking program aimed at non-LP SPDR holders who wish to access free VPN services. Spider Nests will be funded by the APY Scaling Mechanism, enabling price stabilization to coincide with the growth in demand for SPDR linked to SpiderConnect Router and VPN adoption.
Introducing Spider NESTS
Spider Nests is a new concept that will enable SPDR token holders to lock-up their SPDR token in a “Nest” for either 1, 3, 6, or 12 months, receiving increased rewards based on the length of the lock-up.
APY Scaling Mechanism
The APY Scaling Mechanism will be introduced to redirect a portion of the emissions from the liquidity mining program into Nest Rewards to facilitate the Spider Nests.
To do this, we will gradually reduce token emissions generated from liquidity mining from 50 SPDR per block to 25 SPDR per block over the course of 5 weeks and reduce the length of the liquidity program from 5 to 4 years.
This will help cater to a wider variety of SPDR token holders, enabling them to choose how they wish to deploy their SPDR:
1. Liquidity Mining: Benefit from free VPN access via LAU and earn high APY by staking an SPDR/X pair.
2. Spider Nest: De-risk their holding, generate a guaranteed APY, and enjoy the product benefits of SpiderVPN
Overall, the introduction of this new mechanism will bring several benefits to the SpiderDAO ecosystem, including:
1. Incentivise committed, long term supporters of SPDR with product-based rewards and guaranteed APY.
2. Enable smoother scaling of token utility with product adoption.
3. Help convert a more significant market share of SPDR holders into SpiderVPN users and enable them to leverage LAU’s benefits even with staked tokens in the Vault.
Spider Nest and Liquidity mining changes will go into effect in the second part of January. The exact date will be announced closer to the launch.
About SpiderDAO
SpiderDAO’s vision is to bring unparalleled online privacy to the end-user. As a Decentralized Autonomous Organisation (DAO), it requires addressing the shortcomings of current DAO frameworks. We do so through a multi-layered governance setup based on hardware and software tools on top of a Fair & Resilient Hardware-based DAO built on Polkadot.
Our ecosystem, then, is built on the foundations of fair governance. It includes the SpiderDAO, SPDR Token, and the SpiderConnect Router, which come together to create a robust, scalable, and community-driven ecosystem that will keep up with the pace of technology change and stand the test of time.
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