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xDEUS veToken Model

Based on Curve Finance’s veCRV, the xDEUS veToken model is designed for the XMAQUINA ecosystem. DEUS holders stake their tokens to participate in governance and potentially share in value created by the ecosystem. DEUS is an ERC20 token compatible with the OFT (Omnichain Fungible Token) standard and is non-transferable unless modified by DAO governance. Staked DEUS is represented as xDEUS, an ERC721 soulbound NFT that is non-transferable. This model uses the Aragon veGovernance stack to promote long-term commitment and active participation while meeting legal and operational needs.

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How It Works

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Time-Based Staking

DEUS holders lock their tokens to receive xDEUS. There is no fixed end date chosen upfront; instead, voting power increases over time based on the duration of the stake.
  • Minimum Lock Period: Stakes must be held for at least the minimum lock period (initially 5 days, configurable via governance) before unstaking can be requested.
  • Unstaking Cooldown: A cooldown period (e.g., 5 days) applies to unstaking requests to prevent rapid entry and exit from governance.
  • Voting Power Growth: Each staked DEUS starts with a base multiplier of 1x, providing 1 voting power per DEUS. The multiplier grows linearly to a maximum of 12x after 12 months.
    • Formula: Multiplier = 1 + 11 × (time staked in months / 12)
      • At 0 months: 1x
      • At 6 months: 6.5x
      • At 12 months: 12x (maximum, maintained if stake continues)
  • veBalance: Your veBalance (also used as veRewardBalance) = Staked DEUS amount × Multiplier. This determines voting weight and any potential reward shares.
Two entities staking the same amount of DEUS may have different veBalances and claimable amounts based on stake duration. Converting DEUS to xDEUS is done by depositing into the escrow contract via the Aragon DAO interface. Additional DEUS can be added, or the stake extended, to increase the multiplier. For non-transferable DEUS holders, staking may be available pre-TGE (Token Generation Event).

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Governance Power

xDEUS holders govern the DAO, voting on treasury strategy, SubDAO approvals, capital allocation, and ecosystem upgrades. Voting influence is tied to veBalance, ensuring long-term committed participants have greater say. Only staked DEUS (via xDEUS) counts toward governance, concentrating decision-making among active, aligned participants who are incentivized to steward the ecosystem responsibly.

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Benefits of Converting to xDEUS

Converting DEUS to xDEUS aligns holders with the project’s long-term success. Key benefits include:
  • Governance Influence: Participate in key decisions, such as investments and fund allocation. Higher veBalance from longer stakes provides more voting power.
  • Potential Profit Distributions: If the DAO approves an investment exit and decides to distribute profits, up to 33% may be allocated to xDEUS holders, pro-rated by veBalance. This weights distributions toward longer-term stakers.
  • Additional Perks:
    • Potential for emissions or rewards from gauges, if enabled via governance.
    • Potential access to bounties (under consideration).
    • Signals commitment, fostering community trust.
Downsides include locked DEUS, limiting immediate liquidity. However, the linear multiplier growth rewards sustained staking, with maximum benefits at 12 months or beyond (capped at 12x). Short-term stakers receive baseline benefits, but long-term holders maximize influence and potential returns.

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Profit Distribution

When the DAO exits an investment (e.g., selling private equity shares in robotics positions), profits are calculated as exit value minus initial investment. Distribution occurs as follows, if approved by governance:
  • 33% of Profits: Used to buy DEUS on the open market. The purchased DEUS is distributed to xDEUS holders pro-rata based on veBalance / total veBalance (snapshotted at the relevant governance epoch).
  • 67% of Profits + Original Investment: Retained in USD and added to the DAO treasury for future investments.
This creates incentives for long-term staking, as higher multipliers result in larger shares. Market buys of DEUS generate demand without dilution.

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Value Increase for All DEUS Holders

The 33% profit allocation rewards committed stakers with additional DEUS. The retained 67% grows treasury assets, increasing net asset value (NAV) per DEUS token. Market buys add demand, and no new tokens are minted, avoiding dilution. This benefits all holders: stakers gain direct distributions and potential appreciation, while non-stakers see token value rise through stronger fundamentals and reduced circulating supply pressure.

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Why It Matters for XMAQUINA

In a capital-intensive sector like Physical AI, long-term, mission-aligned governance is essential. The xDEUS model ensures that those who govern the system are committed to its success. It also unlocks a compliant, transparent mechanism for distributing value to contributors, creating a flywheel where staking, governance, and ecosystem growth are mutually reinforcing.