General concepts
vsTAN stands for value-sharing TAN, and is the locked version of TAN.
vsTAN holders earn the majority of protocol earnings, which are distributed as USG, and can participate in Tangent’s governance.
It is possible to lock in perpetuity to avoid relocking, and to exit a position before the end of its unlock schedule against a penalty fee.
Locked TAN positions are represented by NFTs.
Rewards distribution
Rewards are distributed tovsTAN holders according to their share of the total vsTAN supply.
60% of protocol earnings are distributed to vsTAN holders in the form of USG. Holders also have the option to claim their rewards as sUSG instead of USG.
Rewards are streamed linearly over 7-day periods.
Lock duration
The duration of a lock is fixed and set to a maximum of 13 weeks. If tokens are locked in the middle of an epoch (a 7-day period), they will be locked for 12 weeks, plus 1 to 7 days. A lock’s duration can be reset to 13 weeks at any time while tokens are locked. OnceTAN tokens are unlocked, they sit in the locking contract and can be withdrawn (doing so burns the NFTs). After 2 weeks, unlocked TAN tokens can be kicked out of the contract by other users against a 0.25% bounty. A position with unlocked tokens continues to receive rewards until being kicked.
A perma-lock option exists to lock a position in perpetuity, to avoid relocking. The perma-lock option can be removed at any time after being activated. Once the perma-lock option is removed, tokens are locked for the standard 13-week duration.
Early exit
It is possible to exit a locked position before the end of the standard 13-week duration against a penalty fee. The penalty fee is linearly proportional to the remaining duration of the lock. For example, if the early exit is triggered after 70% of the lock’s duration, 30% of lockedTAN tokens are forfeited.
Following an early exit, forfeited TAN tokens are sent back to the DAO wallet.
Split positions
A locked position can be divided into two smaller positions. It is required to indicate how thevsTAN balance should be allocated between the new positions.
The two locked positions newly created will share the same unlock schedule as the original position prior to the split.
Merge positions
Two locked positions can be merged into a single one, additionning theirvsTAN balance.
The single locked position newly created will share the same unlock schedule as the longest one (i.e. the position that unlocks the later) prior to the merge.