Liquidity Directing

The role of Liquidity Directors in the Tokemak protocol.

Introduction to Liquidity Directing

201 Level Reactors Course

Liquidity Directing is a Tokemak Pilot's primary responsibility. Staking TOKE grants users a proportional amount of voting power, and these votes are used to determine where liquidity from a given Reactor will flow.

Voting does not require paying gas fees, and Pilots can reallocate votes at any time across multiple Token Reactors. Simply allocating votes to a Reactor is all that is needed to become a Liquidity Director and receive TOKE rewards, but experienced Pilots may enable Pro Mode for an additional level of granularity beyond the default. With Pro Mode enabled, votes may be allocated to specific exchanges, such as Curve, Uniswap, and Sushiswap.

Rewards are based on the performance of the underlying deployment strategy, and additional external incentives such as bribes may sway Pilots to vote for certain Reactors and venues.

At the beginning of each cycle, liquidity for all Reactors is redeployed based on committed votes.

Yield generated from Liquidity Deployment is returned to Tokemak's treasury of Protocol Owned Assets. Combined with assets from strategic investments and DAO partnerships, this yield contributes to the end goal of achieving The Singularity.