📈TVL Points

The Total Value Locked (TVL) Points system rewards users for holding asset balances on the platform. This encourages users to maintain their funds funds on Paradex, enhancing the platform's liquidity.

Key Parameters

Parameter	Value	Description
TVL Cap	1,000,000	The maximum value up to which an account can earn TVL points.
Weekly TVL Points Rate	20 points per 1,000 USD	The rate at which points are accrued for each 1,000 USD of TVL per week.

• TVL Cap: This limit ensures that points are not disproportionately accumulated by accounts with extremely high TVL, promoting a balanced distribution of points.

• Weekly TVL Points Rate: This specifies how many points are earned per 1,000 USD of TVL over a week.

Accruing Formula

TVL Points are accrued continuously based on the account's TVL over time.

The formula to calculate the TVL Points accrued over a time interval $\Delta t$ (in seconds) is:

$$\text{TVL Points Accrued}=\frac{\text{Weekly TVL Points Rate}}{1,000}*\frac{\Delta t}{7\times24\times3600}*\text{Capped Account Value}$$

Where:

• Weekly TVL Points Rate: The points rate per 1,000 USD of TVL per week.

• $\Delta t$: The time interval in seconds over which points are calculated.

• $7 \times 24 \times 3600$: The total number of seconds in a week.

Capped Account Value

To calculate the TVL Points, we first determine the Capped Account Value which is the lesser of the account's actual TVL and the TVL Cap:

$$\text{Capped Account Value}=\min(\text{Account TVL},~\text{TVL Cap})$$

This cap ensures that the calculation takes into account only up to 1,000,000 USD of the account's value, even if the actual TVL exceeds this amount.

Key Differences from Core Points Programs:

• No Fixed Allocation: Unlike other points programs with a set points pool, TVL Points are calculated independently for each account, based on its TVL.

• No Market-Based Allocation: TVL Points are awarded purely based on the overall account value rather than specific market or asset allocations.

Example Calculation

Program Parameters

• TVL Cap: 1,000,000 USD

• Weekly TVL Points Rate: 20 points per 1,000 USD per week

• Assuming no changes in TVL over 1 hour ($\Delta t$ = 3600 seconds)

Scenarios

Account X: TVL = 600,000 USD

TVL Points Accrued = (20 / 1000) * 3600/(7*24*3600) * min(600000, 1000000)
                   = 0.02 * 1/168 * 600000
                   = 71.4286 points

Account Y: TVL = 1,500,000 USD

TVL Points Accrued = (20 / 1000) * 3600/(7*24*3600) * min(600000, 1000000)
                   = 0.02 * 1/168 * 1000000
                   = 119.0476 points

In the examples:

• Account X earns points based on its full TVL of 600,000 USD as it is below the cap.

• Account Y earns points based on the capped value of 1,000,000 USD, despite having a higher actual TVL.