LP Staking

LP Staking is the primary mechanism for liquidity providers to earn a share of the protocol’s revenue. By staking AEC/Stablecoin LP tokens in the AECStakingLP.sol contract, participants earn yield while strengthening market stability, reducing slippage, and enhancing long-term resilience of the ecosystem.

Staking Pool Allocation: This pool receives 50% of the total rewards distributed by the PerpetualEngine, making it the main source of yield for LP participants.

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Multi-Tier Commitment System

The LP pool uses a four-tier system, mirroring token staking, rewarding long-term commitment with proportional multipliers:

Tier	Lock Duration	Reward Multiplier	Target User
Flexible	None	1.0x	LPs requiring exit flexibility and active position management
Monthly	30 days	1.1x (+10%)	Short-term LPs seeking a modest boost
Quarterly	90 days	1.3x (+30%)	Medium-term LPs committed to ecosystem growth
Semi-Annual	180 days	1.6x (+60%)	Long-term LPs seeking maximum yield in the highest reward pool

This allows LPs to align staking strategies with their conviction and liquidity needs.

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Protocol Engine Tier

A unique feature of the LP Staking Pool is the exclusive tier for the PerpetualEngine:

• Eternal Lock: All Protocol-Owned Liquidity (POL) is staked permanently (type(uint256).max)

• Fixed Multiplier: 1.0x ensures the Engine’s stake does not dilute community rewards

• Compounding Flywheel: Rewards earned by the Engine’s stake are reinvested into the system, sustaining recursive growth

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Dual-Source Reward Model: Guaranteed Stability & Compounding Growth

LP staker yield comes from two complementary sources, consistent with token staking:

1. Base Rewards (Perpetual Baseline Yield)

• Genesis Allocation: 177,777,777 AEC

• Decay Rate: 0.5% per month of remaining pool

• Guarantee: Continuous baseline yield even during low protocol activity

Base Reward Decay (First 24 Months):

Month	Estimated Monthly Release (AEC)	Remaining Pool Balance (AEC)
1	888,889	176,888,888
2	885,444	176,003,444
3	880,922	175,122,522
4	875,613	174,246,909
5	871,235	173,375,674
6	867,131	172,508,543
7	862,543	171,645,999
8	858,230	170,787,769
9	853,939	169,933,830
10	849,669	169,084,161
11	845,421	168,238,740
12	841,194	167,397,546
13	836,988	166,560,558
14	832,770	165,727,788
15	828,639	164,899,149
16	824,496	164,074,653
17	820,373	163,254,280
18	816,271	162,438,009
19	812,190	161,625,819
20	808,129	160,817,690
21	804,089	160,011,657
22	800,065	159,213,536
23	796,068	158,417,468
24	792,084	157,625,384

2. Bonus Rewards (Stacking APY Engine)

This is the main APY driver, converting protocol performance into compounding rewards for LPs.

Distribution Mechanism:

• 7-Day Reward Stream: Each runCycle() injection from the Engine is distributed evenly over 7 days

• Stacking & Compounding: Remaining rewards from active streams are added to new injections, resetting the 7-day distribution

Example of Stacking Bonus :

Day	Engine Injection	Remaining Bonus from Previous Day	New Total Bonus Pool	New 7-Day Stream Duration
1	+1,500,000 AEC	0 AEC	1,500,000 AEC	7 Days
2	+1,500,000 AEC	~1,285,714 AEC	2,785,714 AEC	7 Days (Reset)
3	+1,500,000 AEC	~2,391,836 AEC	3,891,836 AEC	7 Days (Reset)

This compounding mechanism continuously grows the bonus pool, creating strong compounding effects and a constantly refreshed reward distribution.

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Sustainability Through Design

The dual-source model ensures LP staking incentives are:

• Predictable: Base rewards gradually decrease, ensuring sustainable rewards.

• Scalable: Stacking bonus amplifies rewards as protocol activity grows.

• Fair: Community LPs benefit from higher multipliers than the Engine’s permanent stake.