Allocation Strategy

The two main objectives are to kickstart the infinite-LST future and to provide good yields to INF holders. It is important to strike a balance between the two. Here is a proposed “v0” strategy for Infinity: this can and will change over time. This v0 allocation strategy will be run for one month.

The plan is for Infinity to be able to service the majority of LST trading volume. To that end, Infinity must have good returns so that it can stand alone as an attractive option. We do not want Infinity to have to rely on aggressive LM rewards -- some may be acceptable to bootstrap it at the start, but certainly not in the long term.

20%: new LSTs

Objective: to incentivise the creation of new LSTs and kickstart the infinite-LST future

20% of Infinity will be delegated to new whitelisted LSTs.

  • 1,000 SOL minimum delegation (minimum delegation may dip below 1,000 SOL if Infinity TVL is low)

  • The rest of the 20% will be delegated equally to all new LSTs, weighted proportionally by APY over the last 3 epochs.

80%: basket of LSTs + trading returns

Objective: to provide diversified staking yields + maximise trading volumes, to result in an overall strong APY.

  • For now, target allocation will be directly weighted by TVL. We operate under the assumption that trading volume is proportional to size. We are well aware that trading volume naturally has a centralising effect, so it's important for us to take this into account. If a new, small LST has a lot of trading volume, we can rebalance to better service that.

  • Future versions of the allocation strategy will adjust for APY and may also consider an adjustment to overweight smaller LSTs.

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