Glow Token (GLOW)
The Glow token (GLOW) is Glow Protocol's governance and revenue-generating token.
Owning and staking GLOW enables participants to steer the governance of Glow protocol and manage its ecosystem fund. Moreover, GLOW stakers share the income generated by Glow's world of dApps, which are accumulated in the reserve.
The economic design of Glow protocol is built on the foundation that the GLOW token should capture its revenues and accrue value as the deposits and Total Value Locked increase. As TVL increases, the protocol revenues are captured by GLOW token, distributing them pro-rata among GLOW stakers.
Glow is a community-focused project. As such, the GLOW token is fair-launched, with most of its supply distributed with airdrops and ecosystem rewards.
The GLOW token has two main roles: protocol revenue accrual and governance.
GLOW is designed to increase in value in proportion to the expansion of its Total Value Locked.
As deposits increase, the weekly yield generated from Anchor increases. This enlarges the awards distributed at the Glow Yield Weekly Lottery. When a prize is distributed, Glow protocol takes a 5% cut, which goes to the reserve. It should be noted that the % fee can be always modified through a governance poll. The community will choose at which stages is better to optimize for protocol profits or user capture.
A secondary fee comes from unsuccessful governance polls. When a governance poll fails to reach the required quorum, which is defined by the community, the poll initial deposit is redistributed to Glow stakers.
The Governance of Glow is divided into two functions: strategically choose the parameters of the protocol and manage the Glow Ecosystem Fund (GEF).
There are protocol parameters, such as the reserve fee on prizes or the ticket prize, that can be optimally adjusted depending on the stage of the project. Such decisions are governed and voted through polls. For a deeper dive on the different parameters that can be changed by the community, check Governance.
The other key role of the Governance is to manage the Glow Ecosystem Fund. The GEF is purposed to fund community grants and strategic investments that can multiply the reach and success of the Glow protocol. From creating frontends for specific nationalities and demographics to research proposals on the benefits of prize-linked savings accounts like Glow.
The total supply of the token is 1,000,000,000 GLOW, which is going to be minted and distributed over a minimum 4-year period, starting at the launch token airdrop event.
We’ve decided to reward those who are helping build the Terra ecosystem through a 50,000,000 token airdrop. We hope to engage community members that will help GLOW further shape its mission and make yield accessible to everyone.
Taking inspiration from mechanisms like quadratic voting and quadratic funding, the “fairdrop” is meant to decrease distribution inequality in the airdrop set, while still recognizing the contributions of larger stakeholders.
The Terra participants who benefit from the GLOW airdrop are:
- Anchor Stakers
- Luna Stakers
- Anchor Holders
- Anchor Depositors
- MINE Stakers
It’s key that an airdrop distribution is resilient. Therefore, a minimum of 10 UST equivalent was put in place to prevent dust accounts and those pretending to game airdrops. Furthermore, smart contracts and TFL wallets were excluded. In total, there are 85822 wallets that will benefit from the GLOW airdrop (not including MINE stakers).
The rest of the Glow token supply will be distributed for a period of at minimum 4 years. There will not be any GLOW token minted beyond the 1,000,000,000 token supply.
The Glow token stakeholders and final distribution will be as follows:
- Glow Ecosystem Fund, 300,000,000 (30%). To be deployed over the next 5 years by the community to fund grants and strategic investments.
- Team and Early Contributors, 225,000,000 (22.5%). Following a 2-year vesting period, including a 6 months lock-up.
- Depositor Rewards, 150,000,000 (15%). Ecosystem rewards to incentivize users and depositors. In the case of Glow Lotto, depositor rewards are distributed following the Target Award Emission Algorithm*
- Investors, 100,000,000 (10%). Allocation for the builder's round, vested over 18 months with a 6- month lock-up.
- Pylon Gateway, 25,000,000 (2.5%). 21M will be distributed across 3 Pylon pools. The remaining 4M tokens will be reserved for upcoming initiatives with Pylon community Details to be announced.
- Community Airdrops, 50,000,000 (5%). Distributed at the genesis and split among LUNA stakers, ANC stakers, ANC holders and ANC UST depositors.
- WarChest, 50,000,000 (5%). Funds allocated to cover future audits, bug bounties and related operational expenses.
- Liquidity Providers, 100,000,000 (10%). Distributed linearly over a period of 2 years, to incentivize liquidity providers of GLOW-UST.
End Year 1
End Year 2
End Year 3
End Year 4
End Year 5
Glow Ecosystem Fund
Team & Early Contributors
Note: The exact emission rate of GLOW for Depositor Rewards is mandated by the Emission Rate algorithm and the parameters chosen by the community. This would modify the rate of token deployment for rewards (ex. 4-6 years) but not the final token distribution. Similarly, the emission rate of GLOW's Warchest and Glow Ecosystem Fund (GEF) are expected estimations, but might be subject to change through governance polls.
After the airdrop phase, there are two ways to get GLOW tokens: either buying them in Terraswap or earning them. Most of the token supply is going to be distributed to the community as ecosystem rewards.
The three main ways to earn GLOW tokens as rewards are:
- Depositor rewards. To incentivize the growth of the TVL and assets under management of Glow Yield, there are rewards to depositors in place. 15% of the total token supply will be distributed as depositor rewards in the next 4-6 years. These rewards follow a dynamic emission rate algorithm, where the rewards increase or decrease depending on the TVL and the deposit targets set by the community.
- Liquidity Provider Rewards. One priority for the success of the Glow protocol is having a liquid pair with UST in Terraswap and other upcoming AMMs in the Terra ecosystem. As such, Liquidity Providers who stake their LP tokens will accrue GLOW tokens as rewards. The LP reward program will have a 1-year duration since the token launch.
- GLOW stakers. Staking GLOW is the third way to accrue more GLOW tokens. It should be noted that when you receive GLOW rewards for staking your GLOW, these tokens are coming from the protocol revenues and are not distributed directly from the token supply.