Whether $BANK captures real protocol revenue goes to the core of its design. Governance tokens alone rarely sustain long-term value. What matters is whether a token is structurally connected to the protocol’s economic output in a way that rewards commitment rather than speculation.
In Lorenzo’s case, revenue capture is best understood as systemic equity, not a simple dividend model.
Where Protocol Revenue Comes From
At the protocol level, Lorenzo generates fees from core financial activity, including:
Management fees from OTFs and vault products
Performance-based fees from profitable strategies
Transactional and operational fees tied to capital movement
Revenue existence is not the differentiator. Routing and allocation are.
Why Distribution Is Not Flat
Rather than distributing fees equally across all token holders, Lorenzo routes value primarily through veBANK. This reflects a deliberate belief: long-term capital commitment and governance participation should capture the majority of economic upside.
A flat distribution would reward passive holders and short-term traders equally with long-term stewards. That weakens governance, distorts incentives, and ultimately degrades protocol quality.
Uneven distribution is not a flaw—it is the alignment mechanism.
How veBANK Captures Value
In practice, protocol fees flow into a revenue pool, typically converted into a stable or low-volatility asset. From there, distribution logic heavily favors veBANK holders, with rewards proportional to locked voting power.
This turns veBANK into:
A yield-bearing position
Compensation for illiquidity
Payment for governance responsibility
Governance stops being a cost and becomes a source of recurring value.
The Role of Unlocked $BANK
Unlocked or lightly staked bank not excluded, but it is intentionally deprioritized.
Possible benefits may include:
Baseline staking rewards
Participation in incentive programs
Indirect exposure via buybacks funded by protocol revenue
These paths exist, but they are structurally less attractive than locking. The design ensures that economic gravity pulls capital toward long-term alignment, not short-term positioning.
The Compounding Feedback Loop
This structure creates a reinforcing cycle:
Protocol activity increases
Fees grow
veBANK yield rises
More tokens are locked
Governance stabilizes
Capital allocation improves
Revenue, governance quality, and token economics strengthen each other over time.
Beyond Distribution: veBANK as Capital Allocator
Revenue is not automatically paid out in full.
Portions may be:
Reinvested into the treasury
Reserved as insurance buffers
Deployed to support new initiatives
Crucially, these decisions fall under veBANK governance, reinforcing the idea that locked holders are not just recipients of cash flow—but allocators of protocol equity.
why Bank actually Represents
Bank not a promise of yield.
It is a framework where profit follows stewardship.
The token captures value most effectively when treated as a long-term claim on the system, not as a short-term trading instrument.
A Short Story to Close
One evening, I was discussing BANK with my friend 王晨, while another friend, 李浩, listened quietly.
“I like that the system doesn’t pretend everyone is equal,” 王晨 said.
“If you commit longer, you carry more responsibility—so you earn more.”
李浩 nodded.
“That’s closer to how ownership works in the real world,” he added. “Just cleaner.”
The conversation ended there. No hype. No slogans.
Just a quiet agreement that alignment matters more than fairness on paper.
