Gauge Weight Voting

A critical secondary ecosystem enabled by gauge voting. Protocols seeking liquidity (e.g., a new stablecoin pool) create bribes—direct payments of tokens or fees—to incentivize ve-token holders to vote for their gauge. Platforms like Votium and Hidden Hand have emerged as decentralized bribe markets, automating the process and increasing capital efficiency for both bribe providers and vote sellers.

The foundational smart contract primitive. Vote-escrow locks a governance token for a user-defined period (e.g., up to 4 years), minting a non-transferable veToken (e.g., veCRV). This mechanism:

• Aligns long-term incentives by tying voting power to committed capital.
• Creates protocol-owned liquidity as tokens are removed from circulation.
• Grants boosts on yield farming rewards for providing liquidity to voted-on pools.

To prevent Sybil attacks, many gauge systems require vote-locking tokens (e.g., veTokens) for extended periods. This aligns long-term incentives by making governance power costly to acquire and manipulate. Key mechanisms include:

• Time-weighted voting: Power scales with lock duration.
• Quadratic voting: Limits large holder dominance.
• Delegation: Allows users to delegate voting power to experts without transferring assets.

A direct economic consequence where liquidity providers (LPs) or protocols create bribes (often via platforms like Votium or Hidden Hand) to incentivize voters. This creates a secondary market for governance influence.

• Economic Efficiency: Bribes can signal the highest yield opportunities, directing capital efficiently.
• Governance Capture Risk: Concentrated bribe power could subvert protocol goals for private gain.
• Voter Apathy: Token holders may vote based on bribe yield rather than protocol health.

The distribution of the underlying governance token dictates control. Without mitigation, large holders (whales) can single-handedly direct emissions.

• Impact: Can lead to emissions centralization in pools that benefit the whale's existing positions.
• Mitigations: Protocols implement vote caps, quadratic voting, or require lock-ups to reduce immediate power.
• Example: In Curve Finance's veCRV model, a 4-year lock provides maximum voting weight, encouraging long-term alignment.

Gauge systems introduce unique financial attack vectors that threaten protocol stability.

• Gauge Griefing: An attacker votes to direct massive, unsustainable emissions to a pool, draining the protocol's token reserves.
• Tokenomics Drain: If emissions are too high or misdirected, it can lead to hyperinflation and token price collapse.
• Flash Loan Manipulation: Borrowing large sums to temporarily gain voting power and distort a single epoch's gauge weights.

Low voter turnout is a major security concern, as it makes the system easier to manipulate.

• Cause: Complexity, gas costs, and lack of immediate reward for diligent voting.
• Risk: A small, coordinated group can control outcomes with a minority of the total token supply.
• Solutions: Protocols use vote delegation, bribe aggregators to automate yield, and gasless voting via snapshot or layer-2 solutions.

The predictable, periodic nature of gauge weight updates creates Maximal Extractable Value (MEV) opportunities.

• Front-running Votes: Bots can observe pending vote transactions and preemptively provide liquidity to the targeted pool.
• Epoch Sniping: Actions are timed to capture rewards right after new weights take effect.
• Mitigation: Some protocols use commit-reveal schemes or randomize the exact timing of weight application to reduce predictability.

A smart contract that measures a user's or pool's contribution to a protocol, typically based on liquidity provider (LP) token deposits. It is the target of gauge weight votes, determining how many emission rewards (e.g., governance tokens) are distributed to that specific pool. Key functions include:

• Tracking staked LP token balances.
• Calculating and distributing rewards based on its assigned vote weight.
• Often implementing a boost mechanism for veToken lockers.

A non-transferable, time-locked representation of a governance token (e.g., veCRV, vlCVX). Users lock their base tokens to receive veTokens, which grant voting power proportional to the amount and duration of the lock. This model aligns long-term incentives and is the primary source of voting rights in gauge weight systems. Holders use veTokens to vote on gauge weights.

A platform (e.g., Votium, Hidden Hand) where third parties can offer incentives, or bribes, to veToken holders in exchange for their gauge weight votes. This creates a secondary market for governance influence, allowing protocols to attract liquidity by:

• Offering tokens or fees to voters who direct emissions to their pool.
• Increasing the yield for voters beyond the base protocol emissions.

The process where a veToken holder assigns their voting power to another address, often a delegator or vote controller. This allows for:

• Vote aggregation by entities managing large voting blocs.
• Participation for users who wish to delegate voting decisions to experts or automated strategies.
• The formation of vote cartels or convex-like systems that concentrate voting power.

The predetermined plan governing how a protocol's native tokens are minted and distributed as rewards. In gauge voting, this defines the weekly emission or inflation rate that is split among liquidity gauges based on their vote weight. Key parameters include:

• Total supply and emission curve.
• The portion of emissions allocated to gauge voting vs. other uses (e.g., treasury, team).
• The frequency of reward distribution (e.g., weekly epochs).

A fixed time period (commonly one week) during which gauge weight votes are cast and tallied. At the end of each epoch:

• Votes are snapshot and weights are calculated.
• The emission schedule allocates rewards to gauges based on these weights for the next epoch.
• This cyclical process creates predictable intervals for bribe markets and voter strategy.