Boosted BALN, a long-awaited enhancement to Balanced's token economics, will be released on October 31.
Read on for everything you need to know about Boosted BALN, how the launch will take place, and what you need to do as a staked BALN holder.
What is Boosted BALN?
Boosted BALN is a vote-escrow token economics model designed to align rewards and voting power with those most invested in Balanced’s long-term success. It’s similar to the model popularised by Curve, and to Omm’s recently-enacted Boosted OMM.
Rather than stake Balance Tokens indefinitely with a 3-day wait to unstake them, Boosted BALN requires you to choose an unlock date in advance. You can lock up BALN for as little as 1 week, or as long as 4 years.
The longer you lock up BALN, the more bBALN you’ll receive. bBALN is a non-transferable token that gives you voting power and “boosts” your earning potential.
What’s the conversion rate? Every 1 BALN you lock for:
- 1 week = 0.0048 bBALN
- 1 month = 0.0208333 bBALN
- 3 months = 0.0625 bBALN
- 6 months = 0.125 bBALN
- 1 year = 0.25 bBALN
- 2 years = 0.5 bBALN
- 4 years = 1 bBALN
Your voting power and network fee earnings are based on the amount of bBALN you hold compared to the total.
BALN earned from loans and liquidity pools depends on the size of your position and the amount of bBALN you hold, compared to other participants. bBALN can boost your BALN earnings by up to 2.5 times the base rate, so the app will show you how much bBALN you need to earn maximum rewards.
Based on the bBALN governance discussion that’s been ongoing since 2021, Boosted BALN will launch with an early-unlock option. But it comes at a steep price: you can only withdraw your total locked balance, and you’ll need to sacrifice 50% of it as a penalty. If there’s a chance you’ll need to use this option in the future, you might want to spread your BALN over several wallets to minimise the damage.
The Boosted BALN upgrade begins on October 31
The Boosted BALN proposal has already been approved by the community, so the upgrade will be released in stages without requiring any additional governance:
- Stage 1: Replace staked BALN with Boosted BALN; turn off network fees (October 31)
- Stage 2: Reactivate network fees (November 7)
- Stage 3: Release live voting (November – date TBC)
Stage 1: Replace staked BALN with Boosted BALN
On October 31 at around 4:45pm UTC, the core smart contracts and the app will be updated to support Boosted BALN. The contributors will deploy a new Boosted BALN contract, redirect voting power & network fees to bBALN holders, and update loan & liquidity rewards to account for bBALN. No downtime is expected during the upgrade.
To simplify the migration experience for users, the upgrade will pause network fees for 7 days and remove the 3-day BALN unstaking period.
When you visit the app after the upgrade, you’ll see an updated Home page:
If you have staked BALN, you’ll be prompted to unstake it from the Rewards section. The BALN will be added to your wallet immediately.
Once you have BALN in your wallet, you can lock it. Choose the amount, and how long to lock it up for. Your bBALN balance, network fee percentage, and loan/liquidity boosts will update automatically, and you’ll see the amount of bBALN you need to earn maximum rewards for your position(s).
Stage 2: Reactivate network fees
Network fee distribution will resume 7 days after the upgrade, on November 7, to give BALN stakers enough time to migrate to bBALN.
All fees collected during the previous week will be distributed based on the number of bBALN people hold at the time fees are reactivated. Make sure to lock up your BALN before November 7 if you want to receive a share.
You can see the percentage of network fees you’re entitled to at the bottom of the Rewards section:
Stage 3: Release live voting
Live voting will be released during November, although the date is not yet confirmed. With it comes an update to the Vote page:
Live voting gives bBALN holders the ability to influence the amount of BALN allocated to incentivised liquidity pools. You can delegate bBALN voting power to your preferred liquidity pools every 10 days. The BALN allocation will be updated once a week to reflect the total bBALN allocated to each pool.
You can only allocate votes to the 7 liquidity pools that are already incentivised, but bBALN holders can list more pools through governance. Once listed, these pools can also “bribe” bBALN holders with additional incentives to vote for them.
Prepare for Boosted BALN
The core Boosted BALN functionality will go live on October 31, at around 4:45pm UTC. No action is required in advance. Just sign in after the upgrade, unstake your BALN immediately, then choose how long to lock it up for.
If you’ve borrowed bnUSD or supplied liquidity to incentivised pools, you’ll want to lock up BALN soon after the upgrade to maximise your earning potential.
If you only care about network fees, just make sure to lock up BALN before network fee distribution resumes on November 7.
Got questions about the Boosted BALN upgrade? Join the Balanced Discord channel and start a discussion.