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| Understand the essential concepts behind ALEX Surge, including LP tokens, voting mechanisms, and reward structures. |
💡 Key Concepts
What is ALEX Surge?
ALEX Surge is a liquidity incentives program that rewards participants for their contributions to the ALEX decentralized exchange (DEX). It is designed to encourage deeper and more robust liquidity pools and active community engagement through a combination of staking and voting mechanisms.
Participants can be:
- Liquidity Providers (LPs) who stake LP tokens in Surge pools to earn rewards.
- Voters who use their ALEX or LiALEX tokens to influence how rewards are distributed among the pools.
What are LP Tokens? 💧
LP tokens are tokens you receive when you provide funds to a liquidity pool. They represent your share of the pool’s assets and allow you to earn rewards from trading fees and incentive programs like ALEX Surge.
When you stake LP tokens in ALEX Surge:
- You lock your LP tokens in the Surge pools for the duration of the campaign.
- You earn $ALEX rewards proportional to the amount of LP tokens you’ve staked.
For a deeper understanding of these concepts, check out the Liquidity Providers section of the docs.
{% hint style="warning" %} Note: Providing liquidity involves the risk of Impermanent Loss. This occurs when the value of the assets in a liquidity pool fluctuates, potentially affecting the total value of your LP tokens. Learn more in the Impermanent Loss subsection. {% endhint %}
Voting Mechanisms in ALEX Surge 🗳️
Voting is a key component of ALEX Surge. It allows participants to influence how $ALEX rewards are distributed across different liquidity pools.
How Does Voting Work?
- Users vote using their ALEX or LiALEX tokens.
- Voting power can be split between multiple pools.
- The more votes a pool receives, the greater share of rewards it earns.
{% hint style="info" %} Important: The ALEX Lab Foundation has a significant voting power (5,000,000), but its votes are excluded from receiving voter rewards. {% endhint %}
What Are Voter Rewards?
Some pools offer voter rewards as incentives to attract more votes. These are additional rewards donated by the pool's project or community.
- Once donated, voter rewards cannot be withdrawn.
- Voters who support pools with voter rewards will share these extra incentives.
The Social Leaderboard 📈
The Social Leaderboard is a unique feature of ALEX Surge that rewards community engagement. Projects can boost their chances of receiving votes by promoting their pools on social media.
How Does the Social Leaderboard Work?
- Projects post about their pools on Twitter/X using @alexlabbtc and #ALEXSurge.
- Engagement metrics (likes, reposts, replies) determine their ranking.
- Higher-ranking projects receive more votes from the ALEX Lab Foundation.
Social Engagement Metrics:
- Likes: 0.5X multiplier
- Reposts/Quote Reposts: 1.25X multiplier
- Replies: 1.5X multiplier
{% hint style="info" %} To be included in the leaderboard, projects must submit their tweets via Discord or Blocksurvey. {% endhint %}
Reward Distribution in ALEX Surge 💰
Rewards in ALEX Surge are distributed based on voting results and LP staking.
Types of Rewards:
- $ALEX Emissions: Distributed to pools based on the percentage of votes received.
- Voter Rewards: Donated by projects to incentivize voters.
- Staking Rewards: LPs receive $ALEX proportional to the amount of LP tokens they staked in Surge pools.
Reward Emission Period:
- The reward emission phase typically lasts 27–28 days.
- After the emission period ends, participants can harvest their rewards and withdraw their staked LP tokens.
Risks and Considerations ⚠️
Impermanent Loss:
Providing liquidity and staking LP tokens comes with the risk of impermanent loss, where fluctuations in asset prices can reduce the value of your staked tokens. This risk is inherent in all liquidity provision activities on AMM-based DEXs like ALEX.
Finality of Voter Rewards:
Once voter rewards are donated by projects, they cannot be withdrawn. This ensures transparency and fairness but requires careful consideration before contributing.
Need Help?
For assistance, please reach out to our Community Managers on Discord and Telegram Channel.