The Points Program

Overview

The Loop protocol's kickstart requires liquidity (i.e., wETH) which will be sourced from the Loop Points Program. The Points Program incentivizes users to lock ETH or Liquid Restaking Tokens (LRT) into the protocol. In exchange, users earn points (Quaaloops). These points are distributed hourly across all depositors to incentivize early locking.

In addition, the program incorporates a referral system. If a referral link is used to make deposits (e.g., ETH or LRT), the referral mechanism allows the referee to earn 20% of the points given to the depositor.

At TGE, 7% will be Airdropped with a linear conversion among all participants.

The Epochs

The points program is structured in three epochs. Two take place before the protocol launches, one after.

Epoch 1: Starting June 20th.

In the first epoch, users solely get points for depositing ETH & LRTs and participating in the referral program.

Epoch 2

With the initiation of Epoch 2, participants can claim their lpETH and get Points for holding lpETH. This claiming transaction automatically converts their deposited LRTs to wETH and puts that wETH in the lending pool, later used for looping.

Epoch 2 unlocks another way to earn points: providing liquidity for lpETH. Users who provide liquidity for lpETH and lock the respective LP tokens with Loop, earn a points multiplier compared to just depositing ETH/LRTs and holding lpETH. This ensures deep liquidity for lpETH.

Epoch 3

With the transition from Epoch 2 to Epoch 3, the protocol launches; enabling Borrowers to loop Pendle Restaking LP Tokens and thereby generating yield for Lenders and Points Program participants.

Now users can earn points for all the actions on the protocol: looping, lending ETH and holding the receipt token lpETH, staking lpETH to earn interest, providing liquidity for lpETH, locking lpETH to forfeit yield but maximize points.

At 100M TVL the third epoch concludes and the LOOP Token launches, marking the final step of the launch sequence.

Points

Epoch 1:

• 1 point hourly for depositing 1 ETH

• 2 points hourly for depositing 1 LRT

• 20% referral bonus on all actions

• 50% penalty of existing points for every withdrawal

Epoch 2:

• 1 point hourly for holding 1 lpETH

• 20% referral bonus on all actions

• 5 points hourly for locking LP-tokens of lpETH (valued in ETH)

Epoch 3:

• 2 points hourly for holding 1 lpETH

• 1 point hourly for staking 1 lpETH and earning yield

• 5 points hourly for locking 1 lpETH and forfeiting yield

• 10 points hourly for LP- of lpETH (valued in ETH)

• 1 points hourly for looping accepted collateral

• 20% referral bonus on all actions

Frequently Asked Questions

Can I withdraw my deposits?

In Epoch 1 you can withdraw at any time. Please note that withdrawing results in a 50% slashing of the active points generated by that asset. Once withdrawn, points generated by that asset, become "inactive" and arent affected by further withdrawals.

In Epoch 2 withdrawals are disabled in preparation of the protocol launch. However, you can always sell your receipt token lpETH on a DEX.

Why do I need to convert my deposits to wETH and mint lpETH with the transition of Epoch 1 to Epoch 2?

The purpose of the Loop Points Program is to bootstrap the lending/borrowing liquidity pool. This liquidity pool only accepts wETH (no LRTs) to be liquidity for Loopers (borrowers).

For every wETH deposited, you get lpETH at a 1:1 rate. This lpETH can then be used across DeFi, i.e., provided as liquidity on a DEX, sold back for ETH, staked to receive Loop protocol revenue or maybe even used as collateral on secondary markets.

Do I also get Eigenlayer and LRT Points?

This is up to the restaking protocols. We are in talks with all of them to have our smart contracts considered in their Points Programs. Once they do, you also get the respective LRT- and Eigenlayer points. It is shown on our frontend what points are currently supported.

Please note that once you mint lpETH, your LRTs are converted to wETH and you stop earning the respective points.

How long do the epochs last?

To remain flexible in development decisions, there isn't a definitive answer to this. However, a 7-day notice period will be provided before the start of each epoch, allowing participants time to make informed decisions.

The transition from Epoch 1 to Epoch 2 will occur shortly before the protocol launch, making Epoch 2 very brief.

6 months after launching the protocol or after reaching $100M in TVL (whichever comes first) Epoch 3 ends.