Lattice 2.0: The Gateway to Constellation Network’s Web3 Ecosystem
Lattice Exchange has evolved into a full web3 Gateway for Constellation’s ecosystem, where businesses can launch their projects and tokens, grow and manage liquidity, and individuals can participate in various stages of the token lifecycle, providing liquidity and earning rewards.
Lattice features decentralized governance where participants can suggest proposals and vote on platform fees and rewards
Through Lattice, users can manage their nodes and data and participate in bounties to grow rewards.
Lattice 2.0 offers six key features that align with the token lifecycle.
#1 Incubation and Advisory
Constellation’s Flight Program provides advisory support for new companies looking to launch a token. The program guides an entrepreneur through each phase of their Token Lifecycle (ideation, fundraising, token liquidity) with the intention to bring innovative solutions to the ecosystem.
In exchange for advisory services, a project will dedicate a percentage of their token supply which will be distributed to veLTX holders.
70 projects have successfully completed the program to date. Future Flight Program participants will be guided through building a state channel and creating an L0 token.
The Lattice Launchpad is an application designed to connect early stage projects to potential backers of a token offering or product sale.
The LaunchPad requires users to stake $LTX (or now veLTX) tokens to secure placement in a pre-TGE token offering.
#3 Node Manager
We view that anything can be a node on our network, offering value and resources back to the network. This is an open platform agnostic to any ecosystem, data source, or project regardless of the chain the token is minted on.
The Node Manager on Lattice ties rewards and bounties to a designated data source.
By connecting a data source such as a Twitter account, a health monitor watch API, Constellation Network’s Hypergraph nodes, or a Dor Traffic Miner, we create programmatic rewards tied to data feeds.
V1 of the Node Manager consists of staking rewards campaigns where the reward emissions are tied to a technical solution — most notably the Constellation Soft Node Program, which locks up approximately 50% of the circulating supply of $DAG per month.
Ecosystem projects can incentivize veLTX holders or existing token holders to create a node campaign and improve reward emissions.
#4 Liquidity Pools and Cross-Chain Swaps
Every project needs to source new liquidity. Lattice provides the ability to swap or exchange a project’s token for other cryptocurrencies.
In the spirit of decentralization, we have partnered with Exolix to create the minimal viable product (MVP) for swapping cryptocurrencies across ecosystems. Exolix is an aggregator of centralized exchanges and supports many of our incubated projects.
Following Exolix, a DEX will be built by a selected team, minimizing regulatory risk and maximizing throughput with parallel development initiatives.
The DEX will include a new token and tokenomics, to solely support liquidity. $LTX/veLTX holders can expect an air drop of the new DEX token, and veLTX token holders can vote on distribution details.
#5 Governance and veLTX
As regulatory scrutiny intensifies across all cryptocurrency based projects, governance and a focus on decentralized development and decision making becomes paramount to the viability of any project.
DeFi evolved governance to attach incentives for community growth and contribution through proposals. Additionally, it has aligned project liquidity goals with the dissemination of control of the future of the ecosystem.
The $LTX token currently powers the platform’s decentralized governance mechanism. However, $LTX is freely traded creating a distraction between the development of the platform and speculation.
In Lattice v2, $LTX must be locked and “converted” into veLTX to initiate or vote on proposals. The purpose behind this setup is to provide users the opportunity to control the direction of the project while requiring them to put down substantive value in order to minimize the likelihood of the platform being co-opted by malicious actors without undue centralization.
veLTX holders will earn rewards and fees accrued through the various Lattice products allowing holders to participate in the platform’s growth. veLTX holders will be rewarded with protocol fee sharing though:
- Launchpad project tokens: veLTX holders may receive protocol fees from every token launching their project via Lattice Launchpad.
- Staking & Node programs: veLTX holders may receive protocol fees from every project running staking programs or node campaigns on Lattice
- Cross-chain swap fee-sharing: On the horizon, cross-chain swap fees will be rewarded to veLTX holders in the form of protocol fees. The final rewards structure will be voted on by governance.
- Bonus airdrops: There will be occasional airdrops of ecosystem tokens for veLTX holders as a surprise bonus.
Every project faces the problem of generating lasting token liquidity (trading liquidity) which can sometimes cost millions of dollars between market makers and incentivized staking pools.
Bonding is a method used to attract project-owned liquidity and retain liquidity on decentralized exchanges.
Bonding improves earlier “yield farming” methods where DEX liquidity providers (LP holders) were incentivized through extraordinarily high APYs to create attractive liquidity. This caused massive token inflation for projects and impermanent loss for users.
Bonding gives a project ownership over their liquidity without inflating the token supply while still allowing users to benefit from yield generating activity.
- Project A allocates $100,000 worth of tokens currently trading at $2 per token in exchange for $1.80 worth of aToken/USDC LP for this campaign
- Users then “bond” their aToken/USDC LP (current market price is $1.80 per share) over the set period (typically 7–30 days) in exchange for aToken valued at $2 per token (a 10% arbitrage based on the current market prices).
In this example, Protocol A will spend $100,000 of their aToken in exchange for $90,000 worth of aToken/USDC LP. This liquidity would now be owned by the protocol itself (Protocol Owned Liquidity).
By owning this liquidity, the project no longer has to emit more tokens to maintain it, they simply hold it in their treasury.
Paying 10% as an arbitrage up-front, allows the users to participate in yield farming without destroying the protocol token value from inflation while creating long-term trading liquidity.
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