Vote Escrowed UMBRA (veUMBRA)

What is veUMBRA?

veUMBRA is the vote-escrowed governance token of the Umbra protocol, allowing users to participate in governance, direct emissions, and earn protocol rewards. By locking $UMBRA tokens for a specified period, holders receive veUMBRA, which grants voting power and other incentives within the ecosystem.

How veUMBRA Works

  • Users can lock their $UMBRA tokens for a period ranging from 1 week to 4 years.

  • The longer the lock duration, the amount if veUMBRA is linearly proportion to the lock period.

  • veUMBRA decays over time, reducing voting power as the lock period approaches expiration.

Benefits of Holding veUMBRA

1. Governance & Voting Power

  • $veUMBRA holders can vote on emissions distribution, directing $UMBRA emission rewards to specific liquidity pools.

  • Voting incentivizes liquidity provision and aligns emissions with ecosystem needs.

2. Fee & Bribe Rewards

  • 100% of trading fees on each LP pair from each epoch is distributed to veUMBRA holders who lock and vote on the corresponding pair

  • Projects can offer bribes (additional incentives) to $veUMBRA holders in exchange for votes, increasing overall earnings

3. Boosted Rewards

  • Liquidity providers who also stake veUMBRA will be eligible to receive boosted rewards in select pools such as bribe incentive from protocols, etc.

  • This mechanism encourages deeper liquidity while rewarding long-term commitment.

Epoch-Based System

  • Each epoch lasts 7 days, beginning on Thursday at 00:00 UTC and ending on Wednesday at 23:59 UTC

  • Votes, emissions, and rewards are calculated at the start of each epoch.

Example Use Cases:

1. Directing Emissions

  • A DeFi project wants to increase liquidity in its token pool.

  • The project offers a bribe to veUMBRA holders to vote for its pool, attracting more liquidity.

2. Earning Passive Yield

  • A user locks $UMBRA for 4 years and receives veUMBRA.

  • Each epoch, the user earns protocol trading fees and bribe incentives, creating a steady yield stream.

3. LP Boosting

  • A liquidity provider stakes veUMBRA and deposits liquidity into a preferred pool.

  • The LP receives higher rewards compared to non-veUMBRA stakers, maximizing earnings.

How to Get veUMBRA

  1. Lock $UMBRA for a selected period (1 week to 4 years).

  2. Receive veUMBRA proportional to lock duration.

  3. Use veUMBRA to vote, earn fees, and maximize rewards.

The Future of veUMBRA

Umbra’s ve(3,3) model aligns long-term incentives with active governance, ensuring sustainable growth. Future enhancements may include:

  • Dynamic emissions adjustments.

  • Expanded governance roles.

  • Additional reward mechanisms for active voters.

veUMBRA empowers users to shape Umbra’s future while maximizing their yield opportunities within the Eclipse DeFi ecosystem.

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