BladeSwap is a 'veDEX' that aims to distribute all platform fees to token holders and allocate emissions through governance voting. By removing the rebase mechanism, BladeSwap seeks to encourage broader participation and no longer identifies as a ve(3,3) DEX.^[1]

Overview

BladeSwap, launched in March 2024, is a 'veDEX' on the Blast network, an Ethereum Layer2 solution providing native yield for ETH and stablecoins. It aims to return 100% of platform fees to token holders and directs emissions entirely through governance voting. By removing the rebase mechanism, BladeSwap seeks to encourage broader participation.

BladeSwap simplifies traditional DEX complexities by supporting native batch transactions, allowing users to bundle actions into a single transaction, saving time and gas fees. Its smart split router aims to minimize price impact during trades, providing an efficient trading experience.

Key features include redistributing all protocol fees to native token holders, multi-airdrop farming for additional rewards, and a real-time voting system for governance. ^{[1][2][3][4][5]}

Maximizing Native Yield

BladeSwap aims to maximize user profits using Blasts's three native yields: L1 Staking yield on ETH, T-bill yield on USDB, and Gas Revenue sharing. Contracts are structured to optimize these yield opportunities.

Pre-Token Generation Event (TGE), liquidity providers can earn 100% of the rebase yield on ETH and USDB, alongside trading fees. Once the voting feature is activated, these yields are intended to be consolidated into internal incentives for token holders, increasing emissions for corresponding providers.

Gas revenue paybacks and a portion of rebase yields are allocated to the free daily loot box, enhancing potential profits for users.^[11]

Daily Free Loot Box

BladeSwap offers daily free loot boxes based on weekly Swap/LP/Gov rankings, recalculated each week. These boxes are designed to unlock after each epoch concludes on Thursday morning, ensuring any unclaimed rewards return to the pool.

Inside these boxes, users may find rewards such as USDB/ETH Rebase yields (available after maturity), ETH gas refunds, Blast Gold, partner tokens, and $BLADE airdrop points.

Referring friends allows users to earn extra boxes, with bonuses granted based on their completion of weekly quests. For every five bonus boxes received by referred friends, the referrer is awarded an additional box.^[13]

Blast Points (Bridged Asset Points)

From November 20th, 2024, users bridging ETH/USD to the Blast launch bridge earn points based on their balance over time. These points accumulate within BladeSwap and are viewable on the Blast Point dashboard. Points are allocated to BladeSwap's Vault contract relative to users' ETH/USDB LP and ETH/BLADE LP stakes, facilitating participation in the Blast airdrop distribution.^[14]

Blast Gold (Developer Points)

Following its achievement as the runner-up in the BigBang competition, BladeSwap was awarded Developer points known as Blast Gold. These points hold potential value for future conversion into BLAST tokens. BladeSwap aims to redistribute all accumulated Developer points and Gold to its community through initiatives like the Daily Free Loot Box system, enabling users to participate in $Blast and $Blade airdrops.^[14]

Season 1: NFT-Centric Distribution

During BladeSwap's initial launch until March 28, 0 UTC, Season 1 of Blast Gold distribution focused on BladeSwap NFTs obtained through Daily Loot Boxes. The allocation of Blast Gold was determined by the number of BladeSwap NFTs held by users, categorized into tiers based on a snapshot taken after the epoch ending on April 4, 2024. BladeSwap phased out NFTs from loot boxes starting April 4, 2024.^[14]

Season 2: Broader Criteria for Distribution

Starting March 28, 2024, 0 UTC, BladeSwap's Season 2 of Blast Gold distribution expanded its criteria beyond BladeSwap NFTs to reward users based on broader contributions to the Blast ecosystem's growth. Following April 4, BladeSwap NFTs were no longer available from loot boxes; instead, users could obtain BladeSwap Season 2 modules. These modules, while non-tradeable, enhance users' weekly rankings, aligning with Blast ecosystem guidelines.

At the end of each Blast Gold distribution in Season 2, all accumulated BladeSwap Season 2 modules will be burned to ensure a fair reset for subsequent distributions. Notably, governance scores will no longer influence loot box allocations. Post-TGE, Blast Gold will be directly distributed to $veBLADE voters, emphasizing governance's role in BladeSwap's ongoing development within DeFi.^[14]

Products

Native Batch Transaction

BladeSwap's Singleton Vault structure supports native batch transactions, allowing users to chain multiple actions (e.g., Swap, Add/Remove Liquidity, Vote, Lock, Bribe, Claim Reward, ETH Wrap) into one atomic transaction. This aims to simplify DeFi processes, reducing the number of transactions and gas fees.

In traditional veDEXes, claiming rewards could require around 20 transactions for extensive voting. BladeSwap's batch transaction capability seeks to streamline this process, improving efficiency and user experience.^[6]

Smart Split Router

BladeSwap's smart split router, introduced alongside native batch transactions, functions similarly to a DEX aggregator. It allows swaps to take multiple paths divided by size, rather than a single route, ensuring minimal price impact. This approach aims to reduce fees typically imposed by third-party aggregators and significantly lower gas costs, optimizing the overall trading experience.^[7]

Yield Maxi

BladeSwap offers an ETH-USDB Yield Maxi pool aimed at providing higher APRs without Blast Points and Gold, distinguishing it from typical Blast Network pools. This pool aims to boost APRs with additional ETH bribes through the Gold Maxi feature, incentivizing voters involved in emission strategies. While it does not distribute Points and Gold, the Yield Maxi Pool facilitates immediate yield farming through elevated APRs.

To add liquidity, users can access the BladeSwap pool page, click on the Yield Maxi banner or the ETH-USDB pool badge, and begin earning rewards in real-time. The platform also features the Magic Deposit option for convenient LP provisioning with a single click, enhancing user experience in managing tokens efficiently.^[12]

Gold Maxi

Gold Maxi is integrated with BladeSwap's Yield Maxi pool. Users who provide ETH bribes to Yield Maxi earn Gold Maxi points, which entitle them to receive Blast Points and Gold generated by the pool. This system aims to potentially enhance returns in Gold and Points for participants.

By contributing bribes to the Yield Maxi ETH-USDB pool, users aim to increase their potential for receiving more Gold over time. It's important to note that bribes made through the veDEX’s vote-bribe feature are irreversible, with a cautionary notice provided during the process. Participants should fully comprehend and agree to these conditions before proceeding.

Gold distribution adheres to a predefined schedule and does not occur immediately. Points serve as indicators of each participant's allocation among Gold Maxi contributors, representing their share rather than direct receipt of gold.^[12]

Tokenomics

$BLADE

$BLADE tokens serve to reward liquidity providers through emissions on Bladeswap. Converting $BLADE to $veBLADE tokens is a one-way process, permanently reducing circulating supply. The total supply of $BLADE tokens is capped at 40 million.^[15]

Allocation

$BLADE token allocations are designated as follows:

• Liquidity Bootstrapping Pool (LBP - Fjord phase): 12%, equivalent to 24 million tokens
• Community: 2%, totaling 4 million tokens
• Marketing: 2%, totaling 4 million tokens
• Liquidity Providers (LP): 4%, totaling 8 million tokens

The LBP and LP allocations are subject to adjustments based on the outcomes of the LBP sale, with any excess tokens after launch scheduled for burning.^[15]

$veBLADE

$veBLADE functions as BladeSwap's governance token, obtained by converting $BLADE tokens, thereby reducing the circulating supply permanently. Unlike NFTs, $veBLADE can be freely exchanged back to $BLADE at prevailing market rates via the liquidity pool. Ecosystem and team allocations are securely locked within $veBLADE.

$veBLADE empowers token holders to engage in governance activities, allowing them to vote on protocol proposals without any imposed lock-up period. Each $veBLADE token carries an equal vote, ensuring democratic participation. Liquidation to $BLADE is seamless through the $BLADE/$veBLADE trading pair on BladeSwap.^[15]

Allocation

$veBLADE tokens represent the locked allocations within BladeSwap's ecosystem:

• Ecosystem: 8% of total supply (16 million tokens); Allocated for ecosystem development and growth initiatives.
• Team: 12% of total supply (24 million tokens)

These $veBLADE tokens are permanently locked to maintain stability and support the governance and developmental goals of BladeSwap.^[15]

Emissions

Bladeswap has designed an emission strategy to distribute a total of 120 million $BLADE tokens over a period of two years. Initially, weekly emissions begin at 1.2 million tokens, equivalent to 3% of the initial supply, and are structured across distinct phases.

In the first phase spanning 14 weeks, emissions escalate by 3% each week, intended to foster robust protocol engagement and facilitate partner integration. Following this period, emissions transition into a phase where they decrease by 1% per epoch, aiming to moderate supply inflation as the platform matures.

Ultimately, after 98 weeks, decisions regarding emission levels will be determined through governance processes, empowering $BLADE token holders to participate in shaping the platform's future growth and sustainability.^[15]

Voting

BladeSwap aims to simplify the complex voting system of ve(3,3) DEXs. Users employ fungible ve tokens and can use "smart vote" for automated voting, avoiding the need for epochs, veNFTs, and manual calculations. The platform uses fungible voting tokens for equal lock-up conditions and easy liquidation via the BLADE-veBLADE pool.

BladeSwap seeks to streamline voting by allowing adjustments anytime to maximize yields and providing real-time rewards. This approach aims to make voting APR consistent across pools without repetitive weekly actions.^[8][9][10]