How Gauges work on veDFX
Besides voting on governance proposals, veDFX owners can vote for DFX gauge weights with their veDFX balance. The gauge system implemented by DFX is similar to that of Curve and Angle Protocol.
What is a Gauge:A gauge corresponds to a staking contract and every liquidity pool has one.
By voting for a gauge, veDFX holders can increase the amount of DFX tokens sent to the related staking contract with respect to the others. veDFX holders therefore vote for the gauges they think should receive more DFX rewards.
This allows veDFX holders, who are the most long term users of the protocol, to have control over the future DFX emissions.
So this would mean, no more fixed DFX emission rates to liquidity pools. If providers in those liquidity pools want to keep getting emissions aka DFX rewards, they will have to lock their DFX up for veDFX and vote.
The gauge system lowers the influence of liquidity providers selling off their DFX rewards/emissions since those LPs do not necessarily have veDFX to continue voting for the gauge they are providing liquidity to.
This system strongly favors liquidity providers who continually lock their rewards/emissions into veDFX to increase their pool's gauge weight. Essentially, DFX gauges align incentives of veDFX holders so that the most long term oriented holders control where DFX emissions are distributed.
Users with veDFX can allocate their voting power to the available gauges to influence the reward distribution. Then, the sum of all the veDFX assigned to each gauge by all holders determines the quantity of rewards to be distributed.
Once this is done, users don't have to vote again every week except if they want to change them. Votes for a given gauge can only be changed every 10 days, so that each vote applies for at least two weeks. A person can also decide not to allocate all their available voting power if they choose to do so.
User who have veDFX can therefore feel confident locking the maximum duration of 4 years knowing that the gauge system is not temporary and won't be deprecated any time soon.
Each voting epoch for DFX will be every Thursday at 8:30pm UTC (Starting October 20th) and last a total of 10 days before you can change your vote.
Note:If you have unallocated voting power, you can vote again before the 10 day expiration of your current voting power. Also, 100% of the rewards for epoch 1 (Oct 20-27) will be evenly distributed to all gauges. Epoch 2 will be the start of ve distribution based on voting. ✅
Gauges:Each liquidity pool has one and their weight (emission amount) is dependent on how the veDFX holders vote.
Epoch:The time it takes for a certain amount of blocks on the chain to be completed.
Emission:The rate and amount of rewards released to that gauge.