Economic Model
The Validators DAO economic model connects bandwidth trading and staking rewards within the Solana network through clear, rule-based mechanisms, establishing a transparent and sustainable market structure. At its center lies VLD (Validators DAO Token), which functions as the primary unit of exchange and accounting for bandwidth trading and reward distribution in the SWQoS Market.
Token Design
VLD is the token used for trading bandwidth, represented as SSP (SOL Staking Power), within the SWQoS Market.
The total supply of VLD is capped at 10M (10,000,000) VLD.
Of this, 15% is distributed through an airdrop, and the remaining 85% is allocated for DAO minting.
The total supply of VLD is capped at 10M (10,000,000) VLD.
Of this, 15% is distributed through an airdrop, and the remaining 85% is allocated for DAO minting.
DAO minting operates at a fixed rate of 1 VLD = 0.1 USDC.
When the market price exceeds this baseline, DAO minting is prioritized to prevent excessive price inflation.
The USDC generated from minting is added to the VLD–USDC liquidity pool, supporting both liquidity and price stability in the market.
When the market price exceeds this baseline, DAO minting is prioritized to prevent excessive price inflation.
The USDC generated from minting is added to the VLD–USDC liquidity pool, supporting both liquidity and price stability in the market.
VLD serves as the base currency for bandwidth trading across Solana.
The price of SSP and the market value of VLD reflect real-time network conditions—specifically, the balance between bandwidth demand and supply.
The price of SSP and the market value of VLD reflect real-time network conditions—specifically, the balance between bandwidth demand and supply.
Airdrop
The initial airdrop will be distributed to the DAO community, the OSS ecosystem, and existing contributors.
The recipients are as follows:
The recipients are as follows:
- Open-source contributors to SLV (formerly solv)
- elSOL holders
- EPCT token holders (excluding the core team, DAO wallets, and locked tokens)
- Buidlers Collective (BDLC) NFT holders
- Epics Beta Tester Ticket NFT holders
- Buidlers Guild Card Pack NFT holders
- Participants of periodic snapshot events announced via Discord
- SWQoS Market Beta Testers (Both Bandwidth Users and Validators)
This airdrop serves as a token of appreciation and acknowledgment for those who have supported Solana-related and open-source development projects.
The concept of Validators DAO was born during the development of Epics DAO, an open-source initiative created to address the lack of stable, high-speed Solana development environments.
To solve this challenge, we developed ERPC and SLV, which now serve as the technical foundation of Validators DAO.
The inclusion of Epics DAO supporters as preferred recipients reflects their long-standing contributions to Solana’s open-source ecosystem and their continued involvement in advancing global open-source development.
Without their early support, this DAO could not have been realized.
Part of the initial allocation is therefore returned to these contributors in recognition of their efforts and ongoing commitment.
To solve this challenge, we developed ERPC and SLV, which now serve as the technical foundation of Validators DAO.
The inclusion of Epics DAO supporters as preferred recipients reflects their long-standing contributions to Solana’s open-source ecosystem and their continued involvement in advancing global open-source development.
Without their early support, this DAO could not have been realized.
Part of the initial allocation is therefore returned to these contributors in recognition of their efforts and ongoing commitment.
Market Stability and Price Formation
The market value of VLD is determined through trading activity within the SWQoS Market.
When demand for bandwidth increases, the price of VLD rises, resulting in higher rewards for bandwidth providers.
Conversely, when demand decreases, prices naturally adjust downward, maintaining equilibrium across the market.
When demand for bandwidth increases, the price of VLD rises, resulting in higher rewards for bandwidth providers.
Conversely, when demand decreases, prices naturally adjust downward, maintaining equilibrium across the market.
The DAO minting rate of 0.1 USDC per VLD acts as a stabilizing mechanism against excessive volatility.
If the market overheats, additional VLD is minted to temper price surges; if trading slows, airdrops and shared rewards help sustain circulation.
Through this design, VLD’s supply and demand are synchronized with actual network activity, enabling organic price formation without centralized intervention.
Trading volume and price movements of VLD become key indicators of Solana’s bandwidth utilization and market health.
The market itself serves as a transparent price discovery mechanism within the Solana ecosystem.
If the market overheats, additional VLD is minted to temper price surges; if trading slows, airdrops and shared rewards help sustain circulation.
Through this design, VLD’s supply and demand are synchronized with actual network activity, enabling organic price formation without centralized intervention.
Trading volume and price movements of VLD become key indicators of Solana’s bandwidth utilization and market health.
The market itself serves as a transparent price discovery mechanism within the Solana ecosystem.
3.4 Reward Structure and Market Alignment
elSOL is designed to provide high yield to stakers.
Validators participating in elSOL set their commission to zero and return 20% of their block rewards to the elSOL pool each epoch.
This mechanism allows stakers to receive additional rewards on top of standard staking yields, creating consistently higher returns compared to traditional staking pools.
Validators participating in elSOL set their commission to zero and return 20% of their block rewards to the elSOL pool each epoch.
This mechanism allows stakers to receive additional rewards on top of standard staking yields, creating consistently higher returns compared to traditional staking pools.
Attractive yields encourage continued staking, which in turn supports validator operations and network stability.
In the SWQoS Market, SSP (SOL Staking Power) is traded using VLD.
Providers who sell SSP receive VLD, while buyers obtain priority bandwidth.
For unsold SSP, rewards are distributed based on the proportion of unutilized SSP within shared SWQoS endpoints, ensuring that providers have consistent earning opportunities regardless of direct sales outcomes.
Providers who sell SSP receive VLD, while buyers obtain priority bandwidth.
For unsold SSP, rewards are distributed based on the proportion of unutilized SSP within shared SWQoS endpoints, ensuring that providers have consistent earning opportunities regardless of direct sales outcomes.
The price of VLD fluctuates according to trading activity and bandwidth demand.
The DAO mint baseline of 0.1 USDC per VLD, along with the total supply limit, functions as a safeguard against market overheating or liquidity shortages.
USDC obtained from minting is added to the VLD–USDC liquidity pool, further reinforcing market reliability and transactional stability.
The DAO mint baseline of 0.1 USDC per VLD, along with the total supply limit, functions as a safeguard against market overheating or liquidity shortages.
USDC obtained from minting is added to the VLD–USDC liquidity pool, further reinforcing market reliability and transactional stability.
Through this model, bandwidth provisioning, VLD trading, and elSOL’s reward mechanisms are aligned.
The result is a transparent, sustainable economic structure that operates according to market principles within the Solana network.
The result is a transparent, sustainable economic structure that operates according to market principles within the Solana network.