ALGX Liquidity Rewards Program
Updated: December 23rd, 2022
Liquidity provider performance is calculated on a minute-by-minute basis using random sampling and is aggregated into a score (
) for a given asset pair. Scores of asset pairs are then aggregated into a
score that depicts a users score across all assets. Liquidity providers earn weekly rewards based on their relative
proportion per week.
Orders below a certain minimum depth size per market are excluded. The US dollar amounts are calculated by applying the current ALGO-USD exchange rate.
Orders above a maximum mid-market spread will be excluded.
will not be generated when the spread is above a given market's maximum spread. The initial maximum spreads are listed below and are subject to change. Spreads are measured in basis points (bps). One basis point is one-hundredth of one percent.
For Mainnet Version 1 the maximum spreads are 1000 bps (10%).
Mainnet Version 2 is broken up into grades and are applied to each order:
These rates apply to both versions of the Mainnet reward plans.
is the final score assigned to an individual address for all eligible asset pairs. It is taken by summing up all
scores for a user. The rewards are distributed based on a simple formula:
is the sum of all users
scores for the platform in a given period.
is the rate described above (5%, 2.5%, 1.061%) which varies depending on the week of the program.
360,000,000 is the total supply of ALGX allocated to the rewards program.
How can I claim my rewards?
Rewards will be automatically calculated and distributed to eligible wallets.
Where can I sign up and track my rewards?
The official rewards app has launched, and can be found at rewards.algodex.com. Users will be required to complete a simple sign-up process on the app after connecting their wallet. This sign-up process will require users to send an amount of 0 ALGO to themselves as proof of their participation.
Each week, liquidity providers earn a yield based on their relative
score. The Algodex rewards web app will show users how many rewards they have earned in each week, total earnings, and other statistics regarding rewards.
What is mid-market spread?
The spread between the highest qualifying bid price, and the lowest qualifying ask price in a given market. The mid-market spread takes the midpoint of the market. Qualifying criteria on bid and ask depth can be found here.
i.e., A bid price is $4,000 and the ask price is $4,100. The bid-ask spread is therefore $100, and the mid-market price is $4,050. Therefore, the mid-market spread is $50.
A user's spread is defined as the distance between their order's price and the midpoint of the lowest ask and highest bid on the orderbook.
Due to the volatile nature of cryptocurrency, this document provides details in terms of US dollars. The Algodex platform does not use US dollars, and instead uses Algo. Therefore, ALGO prices will be compared with the most current ALGO-USD exchange rate while calculating user eligibility.
Vesting and Reward Distributions
There is no vesting schedule for rewards. Once the rewards app launches, users will receive their rewards within 2 days of the end of the most recent period. Historical rewards that were earned before the release of the app will be distributed when the app launches.
The official rewards launch date is TBD, however, it will coincide with the rewards web app launch.
will only count on orders in
B. Orders that are in
C are still able to accrue score, but will not receive score from the factor
C orders will only accrue rewards if you have at least 1
B order on both the bid and ask side of the market. This is necessary, as otherwise
would be equal to 0, resulting in an overall score of 0.
Is the rewards code open source? If so, where is it located?
This is the current list of assets that receive multipliers:
- USDC/ALGO = 3x
- STBL/ALGO = 3x
- STBL2/ALGO = 3x
- goBTC/ALGO = 3x
- goETH/ALGO = 3x
- gALGO/ALGO = 3x
- goMINT/ALGO = 3x
- USDT/ALGO = 3x
- GARD/ALGO = 3x
- pTokens BTC/ALGO = 3x
- xSOL/ALGO = 3x
- goUSD/ALGO = 3x
- ALGX/ALGO = 2x
All other assets eligible for rewards receive no multiplier.
Assume a liquidity providers has multiple open bid orders in the goETH market: 1goETH at $3,900; 5 goETH at $3,850; 10 goETH at $3,500. Assume goETH is currently trading at $4,000 (based on mid-market). Assume the minimum depth (for both bid and ask) is $100. Assume maximum spread is 100 bps (1%) and mid-market is $25; therefore, maximum spread vs. mid-market is
Assume a liquidity providers has multiple open ask orders in the goETH market: 1goETH at $4,100; 5 goETH at $4,150; 10 goETH at $4,175. Assume goETH is currently trading at $4,000 (based on mid-market). Assume the minimum depth (for both bid and ask) is $100. Assume maximum spread is 100 bps (1%) and mid-market is $25; therefore, maximum spread vs. mid-market is
Rewards are calculated using a modified version of the Liquidity Rewards Formula. Holding ALGX in a wallet is not a factor, therefore the term
is removed from the equation. Factor weights on
were increased by 25%. Additionally, having both buy and sell orders is not a factor in reward eligibility. The modified version of the Liquidity Rewards Formula is below:
If a user did not place both a bid and ask order, the minimum function would return 0. Therefore, the median of 0 and
will be used instead.
Rewards are calculated using the Liquidity Rewards Formula. June 3 is the 16th week of rewards, therefore the
will be a constant 1.061% until the end of the program (December 22, 2022). ALGX Held in a wallet is a contributing factor to the reward calculation. Having both buy and sell orders is another eligibility criteria.
To be eligible for Mainnet rewards, the user must trade, or have traded verified asset pairs on Algodex between February 10, 9:00:00 and June 2, 23:59:59, for the original rewards system, or June 3, 0:00:00 and ongoing, for the improved rewards system. The rewards from Mainnet can be accrued by anyone committing the criteria.
All specifics outlined in the above rewards plan are subject to change without notice.