Lorenzo is committed to building the first Bitcoin liquidity financial layer based on the Babylon ecosystem, providing crypto investors with a simple and smooth BTC asset liquidity staking experience. Regardless of the amount held, users can easily stake Bitcoin and obtain secure native staking income, while also receiving diversified rewards and returns by participating in the Lorenzo DeFi ecosystem.
In order to promote the development of the ecosystem, Lorenzo recently released a detailed incentive plan, which invites more users to explore Lorenzo's innovative and simplified BTC management and income mechanism.
Current ways for users to participate in Lorenzo
Participate in Bitcoin staking: Users stake BTC or other BTC-wrapped assets (according to the specific requirements of different staking plans) on the Lorenzo platform to obtain liquid staking tokens issued by Lorenzo;
Participate in Lorenzo DeFi Ecosystem: Users can choose to continue to use the stBTC they have obtained (stBTC is the liquidity principal token in the liquidity pledge token issued by Lorenzo) to participate in various projects within the Lorenzo DeFi Ecosystem to obtain more incentives and benefits. This way of participation provides users with the opportunity to obtain additional incentives and maximize their benefits.
The key to both opportunities lies in how Lorenzo tokenizes incentives.
Lorenzo Incentive Tokenization
Lorenzo Liquidity Re-staking Token innovatively introduces a principal-interest separation mechanism, further building Bitcoin liquidity finance by tokenizing Bitcoin pledges into liquid principal tokens (LPTs) and yield accumulation tokens (YATs).
https://x.com/LorenzoProtocol/status/1807782965251850360
Liquid Principal Tokens (LPT)
LPT represents the right to get back the staked Bitcoin principal after the pledge ends. For example, if a user deposits 10 BTC into the pledge contract, the LPT they receive represents the right to get back the 10 BTC.
stBTC as the official LPT
There will be multiple LPTs in the Lorenzo ecosystem. Currently, the Lorenzo protocol uses stBTC as its official liquid principal token (LPT) to avoid liquidity fragmentation. stBTC is 1:1 anchored to the staked Bitcoin, aggregating all staked Bitcoin liquidity.
Yield Accumulation Token (YAT)
The Yield Accumulation Token (YAT) is designed to incentivize users to participate in staking and earn stBTC. YAT represents the right to receive earnings after the staking period ends. Each YAT will accumulate earnings from Bitcoin re-staking.
Since YAT can be freely traded, anyone holding YAT can use them in other DeFi applications.
Ecosystem Participation Rewards
The Lorenzo Incentive Plan consists of two key components: YATs and Points.
YATs (Yield Accumulation Tokens)
Purpose: To encourage users to participate in the staking program.
Function: Represents the rewards that can be obtained at the end of the staking period. YAT includes the native rewards of the staking plan and the Lorenzo token airdrop.
Points (Lorenzo Points)
Purpose: To encourage users to stake and participate in the DeFi ecosystem.
Function: Mainly used for future project token airdrops and other scenarios.
Lorenzo Points System
Our points system is designed to incentivize users to participate in staking and use stBTC in various activities. Here is an overview of the opportunities to earn points:
Base Points
Source: Participate in BTC and other BTC packaged assets pledge. The basic points rules may be adjusted at any time in the future with the event arrangement. We will update you in time for any rule changes. Recent official activities include: Lorenzo pre-pledge Babylon event.
Activity Guide:
https://medium.com/@lorenzoprotocol/lorenzo-betanet-101-guide-to-babylon-pre-launch-staking-ba02f9681d2b
Event time: Starting from 21:00 on May 27, 2024 (GMT+8), until the Babylon mainnet is launched or the Lorenzo staking pool reaches 250 BTC deposited.
Staking rewards: Users will receive 1,500 points per day for every 1 BTC staked
Distribution method:
Lorenzo will distribute points in proportion to the amount of money the user actually stakes. For example, if the user stakes 1.2 BTC, he will receive 1,800 points (1,500 × 1.2) the next day;
Lorenzo will allocate points based on the actual number of days of participation. For example, if a user stakes 1.2 BTC for a total of 9 days, he will receive 16,200 points (1,500 × 1.2 × 9);
According to the above update rules, for users who have participated for more than 20 days, Lorenzo will continue to distribute points at a rate of 1500 points/BTC/day.
Note: For BTC in the pre-staking pool, users can submit redemption applications after August 31, 2024.
Early Bird Points
Source: Join Lorenzo LRZ Supporters and Lorenzo TVL Campaign waitlist
Distribution method:
Lorenzo LRZ Supporter Double Points Rewards: Get 2x points rewards within the first 7 days after the pledge takes effect. Lorenzo TVL Campaign Waiting List members get multiple points rewards. Lorenzo provides multiple points rewards within the first 7 days:
1) Top 100 stakers: 5 times the points.
2) The first 1,000 stakers: 2.5 times the points.
3) The first 10,000 stakers: 1.25 times the points.
Note: The above early bird points should be used for the pre-pledge Babylon activity.
Collaboration Points
Source: Lorenzo There will be certain separate project points allocations based on the specific cooperation projects. Please refer to the cooperation announcement for specific point arrangements.
Project examples:
The Lorenzo pre-staking Babylon event opens an additional points pool for Babylon Pioneer NFT holders, who will share a separate points pool of an additional 5% of the total points generated;
Lorenzo allocates a certain percentage of extra points to users introduced by cooperative projects such as Particle Network. Please refer to official information for specific arrangements.
Campaign Bonus points
Source: Lorenzo will hold joint events from time to time, and the event points are used to incentivize stBTC holders who use stBTC to participate in DeFi activities during the period. Only stBTC TVL that contributes to its business goals will be counted, and the points standards for different projects may vary.
Precautions:
The specific points arrangement will be announced in the relevant activities;
For all DeFi projects integrating stBTC, Lorenzo will take multiple snapshots of the stBTC TVL of all ecosystem partners during the special event;
Every time a snapshot is recorded, users who contribute stBTC to our ecosystem partners will receive points based on the total amount of stBTC contributed
Community Points
Source: Users can earn points by actively participating in community activities and construction. Please refer to the community announcement for specific community incentive points rules.
Other Points
If there are other points arrangements, please refer to the project announcement.
As of the release of this points plan, there is still a portion of the user points that require cooperation projects to provide information that has not been counted. Lorenzo will continue to follow up on the progress of related projects and update the community in a timely manner.
YAT income details:
YAT is the basic interest earned by users for staking, which is used to incentivize users to participate in staking to obtain stBTC. Please note that all BTC and other BTC-wrapped assets received by Lorenzo (according to the specific requirements of different Staking Plans) will be used by Lorenzo to participate in Babylon staking as soon as Babylon goes online. The actual staking progress may be determined by the possible staking limit of Babylon. The staker will receive the same amount of stBTC as the staked BTC.
The first BTC staking activity that users can participate in is the Lorenzo Pre-staking Babylon Activity. The incentive will be composed of YAT income and the above-mentioned points system. The following is the YAT related description of this activity:
Please note that the yield shown on the official Dapp is an annualized yield;
The Babylon pre-launch staking activity will have a cap of 250 BTC;
YAT revenue will be distributed based on the proportion of users’ staked amount;
This time, Lorenzo will provide YAT income of up to 1.5 million USD to users who successfully stake their tokens, which will be composed of Babylon native staking income and Lorenzo token airdrops.
The yield calculation method is as follows: the expected airdrop of $1.5 million is divided by the current total BTC locked in the pre-staking pool;
For the BTC in the pre-pledged pool, users can submit redemption applications after August 31, 2024. Please note that if the Babylon mainnet is launched before then, Lorenzo will be the proxy for staking, and the lock-up period of the BTC staked in Babylon will be subject to the Babylon mainnet rules.
FAQs
Q1: What are the specific income structures for staking users?
The income of pledged users consists of two parts:
1. YAT corresponding staking interest: the basic interest obtained by users staking, namely YAT (Yield Accrued Token);
2. Points Rewards: In addition to basic interest, users will also receive additional points rewards for staking. In addition, the stBTC obtained by users through staking can also be used to participate in DeFi activities, thereby obtaining more diversified incentives and benefits.
Q2: If stBTC is transferred across chains to other ecosystems to participate in DeFi, will the staking points disappear?
Staking points will not disappear, because the staking points follow the EVM address at the time of staking
Q3: If I sell stBTC, will the staking income and points disappear?
Points will not disappear because staking points follow the EVM address at the time of staking; income follows YAT and is not affected by the sale of stBTC.
Q4: If I buy stBTC in the secondary market, will I get Lorenzo and Babylon staking income and points?
There will be no staking income and points when purchasing stBTC in the secondary market. The essence of the YAT and points system is to encourage users to participate in staking and generate stBTC to participate in the DeFi ecosystem.
Q5. After the withdrawal function is enabled, will users still earn interest and points when they withdraw stBTC?
When users withdraw stBTC, no new interest and points will be generated. Users can redeem the project's interest tokens with the accumulated YAT. The amount of redemption depends on the proportion of YAT held by the user and the total number of interest tokens provided by the project. To generate new interest, users need to re-stake BTC (Lorenzo is also expected to launch an automatic reinvestment plan for stBTC in the future to simplify the user's re-staking process)
Q6: What are the advantages for early users?
Basic points: Users who participate early can get full basic points faster. After getting full basic points, users will continue to receive bonus points designed according to time weight.
