How veBAL Works
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There are a few modifications that set veBAL apart:
Instead of locking pure BAL, users obtain veBAL by locking Balancer Pool Tokens (BPTs). This ensures that even if a large portion of BAL tokens are locked, there is deep trading liquidity.
veBAL's maximum locking period is 1 year, a decrease from veCRV's 4 year period. The minimum locking period is 1 week. DeFi moves quickly, and in the event governance decides to use a new voting system, this allows for a shorter, but still sufficiently long, waiting period to transition.
All votes, whether on-chain or on , consider veBAL voting power. In addition to typical DAO votes, veBAL is used to vote on Liquidity Mining Distribution with .
Voting power scales linearly with amount of BPT locked and with amount of remaining lock time.
If a user locks 1 BPT of 80/20 BAL/WETH for the maximum time of one year, they will receive 1 veBAL; however, this veBAL quantity starts immediately decaying with time. If the user does not extend the lock period, this will decay to 0 after the year is complete, at which point the user can redeem their 1 BPT of 80/20 BAL/WETH.
veBAL holders are entitled to a share of 75% of collected protocol fees. Users can collect their proportional share () after the fees are consolidated. Consolidation is a necessary step since protocol fees are collected as a wide array of tokens, and dividing up long tail assets for everyone could result in higher gas fees than token value in some cases.