Everything you need to know about Thales tokenomics
We’ve anticipated this moment and have been planning it for many months. Now that is finally here, we want to share this milestone with you and give you all the information regarding the Thales DAO token.
Thales DAO tokens will be a standard ERC20 token using the ticker THALES. Thales DAO token will be used to govern the Thales protocol. Any further utility is to be decided and voted on by Thales DAO token holders or their chosen representatives, the Thales Council.
THALES token will have a total supply of 100,000,000 (100 million) and will be distributed as follows:
35% to SNX stakers, divided as follows:
- 2% Retro airdrop to anyone who ever staked SNX
- 15% Retro pro-rata rewards
- 18% Ongoing rewards
30% Growth fund, divided as follows:
- 9% Strategic round
- 2% Crowdpooling event
- 18% Thales DAO treasury
- 1% THALES/ETH LP rewards
20% Thales Core Contributors
15% THALES staking rewards
And here you can see a brief summary, in descending order, including vesting schedules.
All the details for each subdistribution are explained below.
Let’s start.
SNX stakers distribution
Thales protocol was spun out from the Binary Options module released by Synthetix in mid-2020. It was seeded by synthetixDAO with an amount of 135k SNX (~$2m USD at the time the agreement was made).
As part of the agreement, 35% of the THALES tokens are to be distributed to the SNX stakers to ensure a long-term alignment between Thales and Synthetix communities.
The details of how this 35% will be distributed on a retroactive airdrop, a retroactive pro-rata distribution, and an ongoing distribution are explained below.
Retroactive airdrop
2% of THALES tokens or 2,000,000 will be airdropped to anyone who has ever staked SNX for at least one snapshot and claimed rewards at least once.
This includes:
- L1 stakers
- L2 stakers
- xSNX stakers
- Yearn vault stakers
The airdrop will be executed using https://github.com/thales-markets/contracts/blob/main/contracts/Airdrop/Airdrop.sol, a variant of Merkle Tree airdrop contract widely used in the DeFi space. The airdrop will be claimable via Thales dapp.
In addition, this airdrop will also include every address who made a trade or minted in any market on Thales before the snapshot and every Thales’ POAP holder until today.
This airdrop is not additive, meaning that if any address qualifies for this airdrop by being in more than one of the qualifying groups it’ll only get one airdrop allocation
An amount of 2,000,000 THALES distributed in this bucket can be considered immediately circulating. At the time of writing this article, there are an estimated 15,000 addresses eligible for the airdrop which would split the 2,000,000 THALES.
You can check the eligible addresses here (updated).
Retroactive pro-rata distribution
15% of THALES tokens or 15,000,000 will be allocated to SNX stakers on a pro-rata basis from the beginning of SNX staking in Q2 2019 until THALES token launch.
Pro-rata distribution is calculated retroactively on a weekly level and then aggregated. To be eligible in a week a staker had to claim rewards from the previous period (maintain a healthy C-Ratio).
These rewards are unlocked linearly over 100 weeks. Effectively, 150,000 THALES can be put into circulation every week provided everyone claims every week.
This distribution is executed using a variant of CRV token launch for retro rewards: https://github.com/thales-markets/contracts/blob/main/contracts/RetroDistribution/VestingEscrow.sol. Curve has happily given their blessing for us to reuse the basis of what they implemented for our contract.
Linear unlock basically means that if you have been allocated 100 THALES in total and the unlock period is 100 weeks, you will be able to claim 1 THALES token at the end of week 1.
Ongoing distribution
18% of THALES tokens or 18,000,000 will be distributed on a pro-rata weekly snapshot basis to SNX stakers. The first week will be the week after the THALES token launch.
After many deliberations on how to best implement it, the final approach is this:
- A variant of the Merkle airdrop contract will be used
- The airdrop contract Merkle tree is reset every week with the new balances based on the last SNX staking snapshot
- If an address has had claimable THALES in the last week but hasn’t claimed them, that THALES is made available to the same address in the next week. In other words, there is no pressure to claim weekly
125,000 THALES will be distributed this way per week over a period of 144 weeks. When claimed the THALES is moved to the Escrow contract with a vesting period of 10 weeks.
Having a weekly script to reallocate THALES rewards allows us to also include L2, xSNX, and yearn vault in the ongoing distribution. It also gives us the flexibility to inspect and adapt how the Synthetix L2 migration is rolled out, provided that at one point the majority of SNX staking will be on L2.
The contract that will be used for this is https://github.com/thales-markets/contracts/blob/main/contracts/Airdrop/OngoingAirdrop.sol.
Thales staking
Thales staking contract is a contract in which users lock their THALES to receive voting power on the protocol. THALES staked balances will be used to determine voting power for governance votes. To incentivize staking 15% of THALES tokens will be distributed to THALES stakers over a course of 150 weeks. Effectively 100,000 THALES per week will be rewarded.
Once THALES staking rewards have been claimed, those are then moved to the Escrow contract with 10 weeks vesting. The escrowed balance is included in the staked balance for governance voting power and staking rewards. Escrowed rewards that are redeemed are no longer included in the staked balance unless those are staked through the staking contract.
To help offset the gas costs, claiming of the staking rewards will be moved to the ongoing airdrop contract and rewards will be carried over to the next period if those aren’t claimed in a given week.
Unstaking is subject to a 7 days unlock period during which no rewards are distributed for the amount being unstaked. When the unlock period is over, the unlocked THALES amount can be redeemed.
Stakers can also be rewarded fees accrued via Thales protocol transactions. The relevant code is in the contracts but needs to be enabled via governance.
Staking contracts and Escrow contracts are as follows:
https://github.com/thales-markets/contracts/blob/main/contracts/Staking/StakingThales.sol
https://github.com/thales-markets/contracts/blob/main/contracts/Staking/EscrowThales.sol
Growth fund
30% or 30,000,000 THALES tokens are allocated to the growth fund.
This fund is to ensure the long-term success of the Thales protocol. The fund will be used for various incentives to foster platform adoption as decided by governance.
Strategy round
Thales protocol has secured strategic support of elite partners in DeFi space. Close to 9% of THALES tokens have been allocated to these partners. The partners have invested close to 3,000,000 in USD pegged stable coins to the DAO treasury.
THALES tokens allocated to the Strategic partners are subject to 2 years vesting with the same contract as used in retroactive distribution to SNX stakers: https://github.com/thales-markets/contracts/blob/main/contracts/RetroDistribution/VestingEscrow.sol
Crowd pooling event
To ensure THALES liquidity after the Token Generation Event, a crowd pooling event will be hosted on the DODO platform accompanying the token launch. 2% or 2,000,000 THALES tokens will be available in this pool. The pool will be set up and configured by DODO core contributors.
LP rewards
Immediately after the crowd pooling, a THALES/ETH pool will be set up. Thales and DODO will seed the pool, enabling double rewards for the liquidity providers that stake their LP tokens. 1% or 1,000,000 THALES tokens will be allocated as rewards for this pool with the frequency of 50,000 THALES per week for 20 weeks. DODO will allocate 300,000 $DODO to this pool with the frequency of 15,000 $DODO per week for 20 weeks.
DAO treasury
18% or 18,000,000 THALES are allocated to the DAO treasury to be used for protocol incentives and ensure continuity of development on Thales protocol.
The initial SNX seed, strategic round investments, and crowd pooling liquidity at end of the pooling will also be added to the treasury. Alongside incentives, the treasury will also handle stipends to ensure top-tier Core Contributors are secured to contribute to the Thales protocol long term.
All incentives are to be approved by governance or chosen representatives. Example incentives:
- THALES liquidity providers rewards
- Platform liquidity providers rewards
- Beta testers incentives
- Thales trading competition rewards
- Content competitions (e.g. memes)
- Thales market makers rewards
Core contributors distributions
20% or 20,000,000 THALES are allocated to Thales core contributors. A core contributor needs to be a full-time contributor for at least a year to be eligible for this allocation.
An individual allocation is subject to 4 years vesting where the first year is fully locked and then the next 3 years linearly unlock the allocated amount for the CC. The start date of the vesting is the date the CC joined the project.
Detailed unlock schedule
A detailed breakdown of the THALES token distribution and unlocking schedule per week is available in this sheet.
Next steps
We know this is a lot of information to take in one go, so if you need to go back and read this article again that’s fine and we encourage it, so everything regarding the THALES token is crystal clear.
If you still have questions regarding this token distribution and its allocations the best way to answer those is by joining our Discord 🏛️ and asking in the help-and-questions channel.
Stay tuned to our next community call, happening on September 8th at 8AM EST / 2PM CET / 10PM AEST where we’ll be sharing more information regarding the THALES token, the upcoming crowd pool and distributions dates 👀.
