PepperDEX's Tokenomic Flywheel

Utilizing PEP, oPEP, and vePEP for sustainable growth

Introduction to PepperDEX's Tokenomic Flywheel

PepperDEX introduces a revolutionary approach to tokenomics with a unique tokenomic flywheel centered around the PEP token and amplified by oPEP and vePEP. This model is designed to foster a harmonious ecosystem, benefiting all stakeholders while ensuring long-term sustainability by incentivizing trading, staking, and the accumulation of PEP.

PEP: The Heart of PepperDEX

At the core of our tokenomic strategy is the PEP token, which offers multifaceted utility within the PepperDEX ecosystem. PEP acts as a utility and governance token, which, when staked, grants holders stake-weighted utility discussed in the PEP Staking section below.

Incentivizing Users with oPEP

Vital to PepperDEX's tokenomic flywheel is the oPEP incentive token. oPEP is an options token that users receive through trading volume incentives. Alternative tokenomic models have succeeded at incentivizing users by rewarding them with tokens but have failed to establish a balanced model that also strengthens the underlying protocol.

Through the use of oPEP, PepperDEX incentivizes users in a sustainable way by giving users the option to purchase PEP tokens from the protocol at a discount to the market price. The oPEP model is a unique model that accomplishes two goals: rewarding users and strengthening the protocol treasury.

By participating in trading, users earn oPEP tokens with a sliding discount based on the timeframe they choose to lock their PEP in the staking contract. The longer they lock, the greater the discount. This reward system encourages active and sustained participation in the ecosystem while also allowing PepperDEX to turn incentives into a revenue stream, a portion of which is distributed to stakers, ultimately benefitting the protocol and incentivizing the PepperDEX community. The Pep Staking section below covers the additional utility PEP holders unlock by staking PEP.

PEP Staking

PEP's utility is activated by staking PEP. Users can stake PEP tokens for variable timeframes, which entitle them to increased discounts when exercising oPEP and increased stake weight, which amplifies PEP's utility.

Staking PEP provides the following benefits:

• Boosted oPEP trading incentives

• Taker fee discounts

• Boosted USDC revenue share rewards

• Voting power in governance

This model ensures PepperDEX users who are most aligned with the protocol receive utility weighted toward the degree of their alignment. Instead of enabling farm-and-dump activities, PepperDEX incentivizes users to compound oPEP rewards into locked and staked PEP in exchange for the utility benefits listed above. This staking process is integral to our economic model, ensuring a balanced and robust token economy that benefits those most aligned with PepperDEX's long-term vision.

Sustainable Growth Through Strategic Tokenomics

PepperDEX's tokenomic flywheel is designed to create a self-reinforcing positive feedback loop of growth that rewards users by giving them ownership of the protocol, zesty utility for the PEP token, and a means to shape the long-term development of the protocol with a robust governance system backed by the PepperDEX treasury. This approach addresses the common pitfalls of DeFi token economics and sets a new standard for token utility and value retention.