🍎Trade Incentive Program
Introduction of Tokenized Utilities Through Incentive Rebates In Relation To Our New Platform Upgrades.
This topic was first discussed in the upgrade introductory blog posts by the core Compendium.Fi team here: https://compendiumfi.medium.com/part-three-the-introduction-of-new-cmfi-token-compendi-pig-platform-utilities-4ee9eef6ea93
A Look At Current Popular Incentive Programs
Incentivization models are an important part of garnering users and community support within the cryptocurrency industry. Most DeFi or tokenized protocols utilize several different forms of incentivization with the most popular being forms of what we call “Liquidity Mining”. Liquidity Mining is essentially a way to reward users for depositing or utilizing specific pool types in regards to the total amount of value locked. A user may deposit a number of tokens into a lending or liquidity provider pool and be rewarded for “staking” their collateral within the protocol. A lot of liquidity mining programs find issues in long-term efficiency as the market becomes oversaturated with their native token and secondary markets suffer due to supply and demand economics.
How We Create Platform Revenue
We feel it is important to remain fully transparent. Before diving further into our new plans, it’s important to understand how our company creates revenue. Compendium.Fi strives to offer a plethora of retail-facing trading tools for free to fight onboarding problems our competitors may face in search of revenue from platform partners and integrations instead. Simply, our platform makes fee and volume rebates for all trades posted through our trading tools, and by decreasing onboarding friction we can increase the potential number of users, therefore increasing the volume posted through the system. It is important to note that we receive a variable percentage of each user’s trading fees routed through our tools so revenue created by each tool or user highly changes in regards to their specific fee schedule, selected exchange, and volume posted. With the introduction of PENDAX (and more than seven newly supported exchanges), we fully expect to garner support in multiple different regions and communities, even during current market sentiment.
More platforms + More Users + No Onboarding Costs = Increased Volume
Increased Volume = Increased Revenue
Our Views On User Growth & Incentivization
Our specific approach to incentivization on the upgraded platform is a bit different, because of one main factor — our platform is different. Unlike most platforms or protocols, our systems expand through the greater cryptocurrency ecosystem and interact with decentralized and centralized trading platforms.
Through months of planning and platform research, we are now ready to introduce our plans to further integrate Compendium.Fi’s native CMFI token and our Compendi-Pigs NFT collection into the greater ecosystem. The new systems (which will be documented below) provide a dual focus on protecting healthy secondary markets through supply and demand economics while also focusing on dynamic incentive models.
Dynamic Volume And Fee Rebate Systems
This system is not currently implemented as we finalize testing requirements before public deployment. Please stay tuned for more information.
The new dynamic incentive models will feature several different stages to balance throughput, token releases, and liquidity additions. These stage changes are not linear and instead will depend on multiple different parameters. The current incentive stage will be displayed on the web portal and be updated as the environment changes to reflect the current program.
The new systems will provide a portion of the revenue generated by trading fee rebates gathered by our platform as CMFI rebates to users. The rebates will be dependent on fees collected through trades posted in our system and other factors discussed below in the stage dissections. It is also important to remember that different users may pay a different amount of fees and incentive allocations will also be dependent on this factor per user.
Stage One Of The Incentive Program
This stage will be utilized when the Ecosystem incentives wallet currently has a balance to support outgoing CMFI transactions.
Revenue & Incentive Breakdown During Stage 1:
Company Expenses: A portion of revenue gathered by our business model will continue to be responsible for paying underlying company expenses. Payroll, infrastructure, marketing, growth, etc.
CMFI Paid From Fund: Stage 1 of the system implies that the Compendium Foundation currently has a positive balance of CMFI in the “Ecosystem Incentives” wallet. A percentage of fee rebates gathered by the usage of our platform will be equally paid out from this wallet to users who opt into (and qualify) for the program.
Liquidity Provision: A portion of revenue gathered by our business model will be used to increase on-chain liquidity in Orca/Raydium CMFI/USDC and CMFI/SOL pools in order to offset supply and demand changes by paying a portion of trading fee rebates back to users.
Stage Two Of The Incentive Program
This stage will be utilized when the Ecosystem Incentives wallet currently has no balance to support outgoing CMFI transactions. This stage will be activated between Ecosystem Incentive vesting unlocks or when trading volume increases to the point that the Ecosystem wallet is emptied in the same period.
Revenue & Incentive Breakdown During Stage 2:
Company Expenses: A portion of revenue gathered by our business model will continue to be responsible for paying underlying company expenses. Payroll, infrastructure, marketing, growth, etc.
Acquire CMFI From Market To Complete Rebate Payments: It is important for the incentive program to proliferate and incentivize users even when the Ecosystem Incentive wallet “runs dry”. In order to continue this program during this period, we will utilize a portion of the revenue generated to acquire CMFI tokens from the open market to immediately make the trading fee rebate payments to eligible users. It’s important to note that this is not a buy and burn and will not itself affect the circulating supply of tokens. The goal here is to not manipulate the price in any way as tokens acquired for the program are immediately sent back out to users with the main point of keeping the incentive programs active at all times.
Liquidity Provision: A portion of revenue gathered by our business model will be used to increase on-chain liquidity in Orca/Raydium CMFI/USDC and CMFI/SOL pools in order to offset supply and demand changes by paying a portion of trading fee rebates back to users.
Stage Zero Of The Incentive Program
This stage should only be considered if the development company or partnered foundation is in need of a temporary revenue boost to accomplish a major goal or is in the middle of changing schedules/underlying infrastructure. We are documenting this phase for full transparency moving forward. Stage Zero temporarily pauses user incentives and liquidity provision until another stage has been implemented.
Introducing New Stages
It is also important to note that the cryptocurrency industry can change and pivot greatly in a short amount of time. We may introduce new stages with revenue funnel breakdowns over time and also reserve the right to make changes to current incentive stages moving forward.
Eligibility And Participation In The Incentive Programs
The documented program above is designated for our suite of centralized exchange trading tools and automated systems moving forward. This includes Verified Trading Bots, Signal Provider Groups, Copy Trading Groups, Portfolio Rebalancing, & Even Our Upcoming Trading Terminal. Participation and eligibility in these programs may however require a user to link a participating wallet to their Compendium.Fi account in order to verify token holdings for participation. Eligibility and participation systems may be introduced at different times.
Eligibility And Breakdowns:
Link Eligible Solana Wallet with 1,000 CMFI tokens to qualify for “base” Incentive program rebates. The base amount percentage of trading fee rebates will be allocated to each user participating in this program. Different users will pay different amounts of trading fees dependent on your account type with each connected exchange and this will affect your trading fee incentive rebates.
Link Eligible Solana Wallet with 10,000 CMFI tokens to qualify for ”regular” incentive program rebates. The “regular” allocation percentage of trading fee rebates will be allocated to each user participating in this program. Different users will pay different amounts of trading fees dependent on your account type with each connected exchange and this will affect your trading fee incentive rebates.
Link Eligible Solana Wallet With 25,000 CMFI tokens to qualify for “godly” incentive program rebates. The “‘god-tier” allocation percentage of trading fee rebates will be allocated to each user participating in this program. Different users will pay different amounts of trading fees dependent on your account type with each connected exchange and this will affect your trading fee incentive rebates.
Link Eligible Solana Wallet With A Verified Compendi-Pig to qualify for dynamic incentive program rebates in line with the rarity metadata attached to each NFT. We are currently planning this integration but it is safe to assume that “common” Compendi-Pigs will equal base incentive program rebates and “legendary/mythic” Compendi-Pigs may equal (or be close to “godly” incentive program rebates. Different users will pay different amounts of trading fees dependent on your account type with each connected exchange and this will affect your trading fee incentive rebates.
Hold Spot CMFI In A Verified Partnered Centralized Exchange Wallet to qualify for either base, regular, or godly incentive program rebates. The amount of CMFI held and which program a user is eligible for will be in-line with the same amounts required while linking an eligible Solana wallet with CMFI holdings. Different users will pay different amounts of trading fees dependent on your account type with each connected exchange and this will affect your trading fee incentive rebates.
It is important to note that we are also exploring staked CMFI to be eligible for this program (if linking a Solana wallet) instead of just holding base CMFI. This would encompass both single-sided staking (being introduced shortly) or staked liquidity pool tokens in a verified Orca / Raydium market.
Fee rebate percentages and incentive breakdowns will be finalized and made public before this program goes live as we gather more feedback from users and community members. A user could significantly increase trading performance by decreasing their trading fees by participating in this program. A user should do their own research and figure out which tier of incentive model would benefit their trading style the most. If a user posts an astronomical amount of taker volume to an exchange then it would be worth participating in the “godly” incentive program.
Fee rebate incentives will also be paid out on an incremental basis and not immediately as trades take place. Current planning is to release rebate incentives on a monthly basis. Users can also opt into paying for verified bot subscriptions or accessing future premium products with their CMFI tokens / rebate incentives.
When Will This Incentive Program Start?
We currently plan to introduce this incentive program shortly after the new trading platform and upgrades go live. More announcements and clarifications will be made in the run-up to the program launch. The new trading platform and applications are scheduled to be released within the next few weeks.
Applying Incentives To Our Decentralized Environment
Our ultimate goal is to also provide this program for our DEX tools in parallel to the activation for our suite of tools for centralized exchanges.
V2 of our Solana DEX has been released and provides a base for the integration of a similar incentive model that works within the same stage breakdowns as listed above.
Instead of working on trading fee rebate revenue from centralized exchanges, this system will provide a dynamic rebate on any fees collected from using all fee-generating products within our DEX (spot markets, swap, etc).
Because fees generated by these products are kept low, we will research and implement more inclusive and beneficial ways to introduce this program in phases over time.
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