Instructions for settling EigenLayer Points market on Vega
Terms
These terms have specific meanings in the text below
points: EigenLayer Restaked Points as described at: Restaked Points | EigenLayer
conversion: Any process by which some or all points become fungible assets such as protocol tokens or stablecoins, or become definitively valueless (e.g. a user/key’s balance is cleared). Conversion is considered to be complete when it is possible to value the points involved in USDT
, even if indiretly (i.e. if points convert to a token with a market price that can be valued in USDT
conversion has occured, but if, for example all tokens are locked and there’s no market price, conversion may not be complete).
mean conversion rate: The average value USDT
at which each point involved in an Airdrop Event underwent conversion.
termination date/time: The time at which trading on the market should stop as a result of an Imminent Airdrop Event.
Airdrop Event
A normal Airdrop Event is deemed to have occurred when one or more of the following conditions is satisfied:
-
At least 40%
of all issued points have undergone conversion (defined above) since the inception of the points programme.
-
Points become freely tradable by at least 40%
of points holders to the extent that a current market price per point exists and the cumulative historic trading volume plus the available liquidity within 20%
of the current market price is at least 10
(%) of the total number of issued points for a (not necessarily contiguous) period of no less than 72 hours
.
Additionally, a “null” Airdrop Event can be triggered when either of these conditions is satisfied:
- It is no longer possible for conversion to happen, for example if the protocol ceases operation. (In this case the mean conversion rate will be zero.)
Note: adjustments to points balances such as normal or reverse splits (1 point becomes, 2 points, 10 points, 100 points, 0.5 points, 0.1 points, etc.), multiplying some users points by some value, etc. etc. do not constitute an Airdrop Event and simply impact the market price of a point as an issuance of new points would.
Once an Airdrop Event has occurred and all input to the Valuation Algorithm is available, the mean conversion rate is calculated and the market will be settled.
Imminent Airdrop Event
An Imminent Airdrop Event will occur following any official confirmation (including implied confirmation as a result of the Airdrop Event happening before/without any official communication) of a future conversion, listing, or other action that would constitute an Airdrop Event.
For an announcement or action to trigger an Imminent Airdrop Event it must originate from or be endorsed as truthful and accurate by the project or another entity with sufficient control to initiate an Airdrop Event.
The termination date/time for the market termination oracle shall be 6 hours
before any event or communication in which the specifics of the Airdrop Event that are required by the Valuation Algorithm are or will be confirmed. If only a date for the announcement is known, the time is assumed to be 00:00 UTC+12:00
.
In the event that the data required by the Valuation Algorithm are available with less than 6 hours
of notice (either due to an unannounced Airdrop Event or listing, or due to a short period between announcement and implementation), the termination date/time will be the current date/time (i.e. termination is immediate).
Note that due to the specifics of the oracle protocol, there will be a delay between the conditions for triggering an Imminent Airdrop Event and the data reaching a market on-chain and the cessation of trading.
Valuation Algorithm
Once an airdrop event has been declared, it is necessary to calculate a value per point in order to settle the market. In some cases this may be possible immediately, and in others more information may be required even once the Airdrop Event has been triggered.
In cases where points have undergone conversion as defined above, or where conversion is no longer possible (Airdrop Event cases 1 & 2):
- The mean conversion rate is the total value in
USDT
distributed to points holders (which may be zero in some cases) divided by the total number of points that have either undergone conversion or been destroyed / become valueless. For the avoidance of doubt, the count includes points for which the holders received more or less than the averge, or even for which they received nothing.
In the case where points become tradable (Airdrop Event case 3):
- The mean conversion rate is the volume weighted average price (VWAP) of one point (converted to
USDT
where trading was not in USDT) over the 72 hours
period prior to the Airdrop Event.
The price of either tokens or points will be determined by the volume-weighted average price for the spot token/point on each exchange with at least 100,000 USDT
in trading volume over the same 72 hour
period.
If multiple exchanges list the spot price, the VWAP of each exchange will be averaged, weighting each for their total traded base currency volume.
Valid exchanges are any of the top 20 centralised exchanges according to https://coingecko.com/exhanges at the time of settlement plus Uniswap (https://uniswap.org) or SushiSwap (https://sushi.com).