Safety Incentives Mechanism

Since the first day of Pawnfi, up to 50% of platform fee from Lending Market are distributed to voting power holders, which we call it Safety Incentives. This is the result of a community-led proposal to align incentives between liquidity providers and governance participants (voting power holders).

Collected fees will be in native token format (ETH/ USDT/ P-Token...etc. from lending pools) and distributed to voting power holders. Voting power are $PAWN placed in the Pawnfi SAFE. See Pawnfi SAFE for more information.

You will also obtain a boost on your provided liquidity by placing $PAWN in SAFE. See Boosting your $PAWN Rewards for more information.

How does Safety Incentives distribution happen?

Each Epoch stands for an accrual cycle, which lasts for 7 days. That is, safety incentives are paid out from the previous week's platform fee. What's more, safety incentives are distributed at secondly basis, which means you will only be able to claim the full amount of Epoch 1 reward at the end of Epoch 2.

For example, if user places their $PAWN in SAFE in the middle of Epoch 1, platform fee distribution will be available at the start of Epoch 2, accruing every second, for Epoch 1 safety incentives. One more thing to note: even though your voting power expires during Epoch 2, you are still able to claim the reward from Epoch 1.

Epoch 1	Epoch 2	Epoch 3	Epoch 4
Jun 30 - July 7	July 7 - July 14	July 14 - July 21	July 21 - July 28
$12,000 fee share	$10,000 fee share	$15,000 fee share	$18,000 fee share
Alice places $PAWN in SAFE, has 100% share	Alice is able to claim $12,000 from Epoch 1	Alice is able to claim $5,000 from Epoch 2	Alice is able to claim $7,500 from Epoch 2
	Bob 50% share. Now Alice becomes 50% share	Bob is able to claim $5,000 from Epoch 2	Bob is able to claim $7,500 from Epoch 2