Do you remember the famous "curve war" in the crypto space a few years ago? Major projects frantically hoarded and locked their governance tokens to compete for the liquidity of a decentralized exchange, much like a group of medieval nobles fighting for control of a castle. This war revealed a simple yet profound truth: whoever holds the voting rights can guide the flow of massive funds and the distribution of profits.
Today, a similar war may be quietly escalating in the asset management field. The Lorenzo Protocol draws on and improves this model, launching its core veBANK model. It attempts to answer a critical question: how can governance voting in decentralized asset management protocols become more than just a "community atmosphere group" and truly become the engine driving ecological prosperity?
From 'snatching pools' to 'selecting strategies': the elevation of the value of voting rights
In the 'Curve Wars', the focus of the voting rights struggle is which 'liquidity mining pool' liquidity should be injected into, which directly affects the prices of the related tokens. This is important, but the landscape is limited—essentially, it is an enhanced version of 'liquidity mining.'
The veBANK model of Lorenzo elevates the value of voting rights to the 'strategy layer' and 'revenue distribution layer.'
Simply put, when you lock in BANK tokens of Lorenzo, you will receive veBANK (voting escrow BANK). This is not just a ticket for dividends, but also a 'strategy baton.' Those who hold veBANK can vote for the investment strategy modules they believe in.
This brings about a revolutionary change:
· Strategy developers no longer just need to work hard in silence; they need to demonstrate the long-term value, risk control, and innovation of their strategies to veBANK holders (the community) to gain more votes and support.
· veBANK holders (ordinary users or institutions) become the 'strategy fund manager review committee.' The strategies they vote for can receive more revenue incentives from the protocol (such as a higher performance sharing ratio or protocol revenue subsidies).
· Result: The best and most trusted strategies can receive the most resources, attract the most funds, creating an enhanced loop of 'high-quality strategies → more votes → more revenue and funds → better performance.'
Beyond imitation: How does veBANK solve 'governance fatigue' and 'short-termism'?
Directly copying the Curve model could cause problems: large holders can easily monopolize voting rights; voters only care about short-term bribery returns rather than the ecosystem's long-term health. Lorenzo's veBANK model introduces more sophisticated designs to avoid these issues.
1. Time-based power: The longer you lock in BANK, the higher the voting weight of veBANK you will receive. This incentivizes long-term, steadfast believers, rather than just short-term speculators looking to 'mine and sell.' Your voting rights are tied to the duration of your commitment.
2. Dual binding of revenue and power: veBANK not only brings voting rights but also directly shares the real revenue generated by the protocol (such as management fee sharing). This means that voters' interests are deeply tied to the long-term success of the protocol. Voting randomly for garbage strategies will ultimately harm their dividends. This forces voters to seriously 'study the targets,' thinking like real investors.
3. Voting for 'strategies' instead of 'tokens': This is fundamentally different from Curve. The voting target is 'investment strategies' that generate real cash flow and risk-return, rather than a simple liquidity pool. The evaluation dimensions are more complex and closer to real asset management, which naturally filters out 'mindless voters' who only want to grab airdrops.
How does the 'flywheel effect' of the Lorenzo ecosystem get started?
Once the veBANK model is in operation, it will drive a powerful ecological flywheel:
Step 1: Early holders lock in BANK, becoming veBANK nobles, and start seriously looking for potential strategies.
Step 2: High-quality strategy developers are attracted to the Lorenzo platform to develop strategies because they can gain voting support from veBANK (which means more revenue and exposure).
Step 3: Rich, high-quality strategies attracted a large number of ordinary investors to deposit funds, leading to a surge in the protocol's assets under management (AUM) and revenue.
Step 4: The surging protocol revenue is fed back to voters and strategy developers through veBANK, incentivizing them to continue to stay and build.
Step 5: A prosperous ecology boosts the long-term value of BANK, attracting more people to lock in and join this positive cycle.
Ultimately, veBANK is no longer just a simple governance tool, but has become the core hub for 'ecological value discovery and resource allocation.'
Challenges and Future: A more complex 'war'
Of course, this 'asset management war' will be more complex than the 'Curve War.' Voters need to possess a higher level of financial literacy to judge the merits of strategies; preventing strategy developers and large veBANK holders from forming a 'strategy cartel' that excludes newcomers is a governance challenge.
But in any case, Lorenzo, through the veBANK model, is trying to move 'decentralized governance' from theoretical discussion to tangible practice. It no longer talks about 'community ownership of the protocol' in vain but has designed an economic system that allows the community to directly decide the success or failure of the protocol's most core product (investment strategies) by exercising power.
In the future, we may see 'lobbying' and 'campaigning' around the Lorenzo strategy library, the rise of 'strategy rating agencies' based on data analysis, and veBANK holders commissioning professional advisors to manage their voting rights. This is no longer a simple liquidity battle, but a higher-dimensional decentralized experiment about 'capital allocation rights.'
From competing for 'mining pools' to selecting 'brains', this may be the true nature of governance tokens.
