The contracts implement a voting-escrow incentivization model for Canto RWA (Real World Assets) similar to veCRV with its liquidity gauge. Users can lock up CANTO (for five years) in the VotingEscrow contract to get veCANTO. They can then vote within GaugeController for different markets that are white-listed by governance. Users that provide liquidity within these markets can claim CANTO (that is provided by CANTO governance) from LendingLedger according to their share.
For instance, there might be markets X, Y, and Z where Alice, Bob, and Charlie provide liquidity. In lending market X, Alice provides 60% of the liquidity, Bob 30%, and Charlie 10% at a particular epoch (point in time). At this epoch, market X receives 40% of all votes. Therefore, the allocations are:
- Alice: 40% * 60% = 24% of all CANTO that is allocated for this epoch.
- Bob: 40% * 30% = 12% of all CANTO that is allocated for this epoch.
- Charlie: 40% * 10% = 4% of all CANTO that is allocated for this epoch.
The used VotingEscrow implementation is a fork of the FIAT DAO implementation, which is itself a fork / solidity port of Curve's original implementation. A few modifications were made to the FIAT DAO implementation, for instance support for underlying native tokens instead of ERC20 and a fixed lock time (of 5 years) that is reset with every action. Also an override to unlock tokens in case of protocol shutdown was added.
The GaugeController contract is a Solidity port of Curve's GaugeController.vy. The whitelisting of gauges is performed differently than in the original gauge implementation.
The controller allows users to vote for gauge weights, i.e. how much of one epoch's CANTO is allocated to one gauge. The controller then enables to query the relative weights for all the gauges at any time in the past.
The lending ledger keeps track of how much liquidity a user has provided in a market at any time in the past. To do so, the (white-listed) markets can call sync_ledger on every deposit / withdrawal by a user. Alternatively, market can also be wrapped around using LiquidityGauge if it is unable to call sync_ledger to track balances.
Canto governance calls setRewards and sends CANTO to the contract to control how much CANTO is allocated for one epoch. Users can then claim the CANTO according to their balance in the market and the weight of this market in the GaugeController.
If a market is not able to call sync_ledger, it can be wrapped using LiquidityGauge. It is enabled by setting _hasGauge = True while whiltelisting market. Original market tokens can be swapped 1:1 with this ERC20 to track liquidity.
We discretize time into one-week epochs and perform all calculations per epoch (week). Claiming is only possible after an epoch has ended.