synopsis

Vote-locking allows Reserve users to shape Index DTF strategies and earn potential fees while strengthening RSR’s role.

Index DTFs on Reserve add a layer of governance not present in traditional De-Fi - locking of voting tokens (such as Reserve Rights (RSR)) in order to participate in the operation of the index where fees are generated.

When you vote-lock, your tokens are vested in a certain Index DTF. You have voting power on which assets are a part, and how they’re weighted, among other fee parameters. This would free up a portion of DTF revenue for vote-lockers.

Vote-lock is not the same thing as staking. With According to RSR Yield DTFs, those staking RSR will earn yield by collateralizing and governing the configurations. Index DTFs, however, exclusively leverage vote-locking to secure governance dedication.

Though stakers serve a similar function themselves as a backstop for pegged or yield-bearing tokens, it is vote-lockers who direct index composition and fees. Both enhance the utility of RSR and link participants to protocol success.

People can choose to vote-lock for any token, but each Index DTF includes a community governance vote to determine what percentage of the platform fees are used to buy and burn RSR.

Lock periods are a week, typically, so that governance proposals can’t be gamed by moving in and out incredibly fast. Once staked, you can’t immediately withdraw your tokens; starting the token unlock process means forfeiting your voting rights.

Getting started is simple. On app. reserve. org and select an Index DTF from the top link, go to Basket Governance , and lock your tokens. This gives you a vote when it comes to the strategic decisions — like for instance adding a NFT exposure or on rebalancing stablecoins — while potentially giving you a piece of the action on DTF fees.

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