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Price Models

PreviousVesting OptionsNextDebt Buffer

Last updated 6 days ago

In Lucid’s VEO (Vested Emission Offering) creation interface, the Price Model section dynamically adapts based on the selected strategy, displaying specific configuration fields tailored to that pricing approach. Once a strategy is chosen, the relevant input fields appear automatically, and must be filled out accurately to ensure the VEO behaves as intended. This modular setup gives protocols the flexibility to align their offering with liquidity goals, market conditions, and incentive design. Below is a breakdown of each pricing model and the corresponding configuration fields.

Fixed-Price

  • Overview: A simple, static model where tokens are sold at a fixed price throughout the entire duration of the VEO.

  • Fields:

    • Initial Price: The constant price at which users will purchase the token. This value remains unchanged regardless of market activity.

  • Use Case: Ideal for protocols seeking predictable and straightforward pricing for participants.

Sequential Dutch

  • Overview: Implements a Dutch auction model where the price starts high and gradually decreases at fixed intervals until it reaches a minimum threshold or the VEO is filled. This mechanism allows natural price discovery based on buyer demand.

  • Fields:

    • Initial Price: The starting price for the auction.

    • Minimum Price: The lowest allowable price that the auction can reach.

    • Debt Buffer (%): Additional margin factored into pricing to ensure sustainability of emissions.

  • Use Case: Best suited for protocols that want to reward early buyers while still allowing for wider participation as price lowers over time.

A Dutch auction begins with a deliberately high starting price—the exchange rate between the two tokens. From the moment the auction opens, that price continuously falls over time until either a buyer steps in or it reaches a preset floor that it can’t drop below.

Sequential Dutch Auction repeats this cycle with every purchase. When a buy occurs, the price resets upward from that transaction level, then once again decays until the next purchase. Think of it as an immediate restart of a fresh Dutch auction for the next token portion.

The auction is bounded by two parameters:

  • Duration – how long each decay cycle is expected to run.

  • Capacity – the total amount of tokens available for sale.

Oracle Fixed

  • Overview: Price is determined using a live oracle feed but remains constant during the VEO. A fixed discount is applied relative to the oracle price at the moment of market creation.

  • Fields:

    • Fixed Discount (%): Discount applied to the oracle price.

    • Max Discount from Current (%): Safeguard to cap how far below the current price the discount can go.

  • Use Case: Suitable for stable pricing environments or protocols that want to offer transparent, consistent discounts with oracle-based tracking.

Oracle Sequential

  • Overview: Dynamic pricing strategy that updates the bond price periodically (e.g., daily) based on a live oracle feed. This allows the price to adjust over time in line with market conditions.

  • Fields:

    • Base Discount (%): Starting discount applied to the oracle price.

    • Max Discount from Current (%): The maximum allowable discount from the live oracle price.

    • Target Interval Discount (%): Amount by which the discount will change at each interval.

  • Use Case: Great for protocols seeking adaptive pricing that evolves with the market, encouraging timely participation across a campaign.

Click here to learn more about Debt Buffer.