As we continue to scale our institutional-grade on-chain asset management platform, bridging diversified yield opportunities with DeFi composability, we face the question of how to build not just a product suite, but a lasting, community-aligned economy.

Today, we answer that question with the launch of Proof of Commitment (PoC), an ecosystem incentive system deeply integrated across our products. PoC is designed to transform every authentic interaction, whether product usage, token locking, or future governance participation, into cumulative $BANK rewards and governance rights.

This isn't a temporary campaign or a one-off reward distribution. PoC is the sustainable economic engine to power Lorenzo's long-term growth, establishing a unified foundation for lasting governance and ecosystem alignment. It consists of three modules that operate in parallel within the same Epoch cycles:

• Season 2 Lorenzo Points - rewarding product participation
• veBANK - long-term governance via $BANK locking
• yLRZ - loyalty rewards for early supporters

Why Proof of Commitment?

PoC is an evolution of prior industry incentive models, advancing the possibilities for long-term alignment between community & project by weaving three core activities into a single, coherent reward tapestry:

1. Product Usage: Your everyday interactions with Lorenzo OTF and Earn vaults.
2. Long-Term Locking: Your commitment to the protocol's future via $BANK locking.
3. Early Support: Your historical loyalty as a community pioneer.

Whether you're a newcomer exploring our products for the first time or a veteran already ready to lock tokens long-term, your commitment is measured, accumulated, and rewarded.

The Big Picture: Epoch-Based Operations and Rewards

Our incentive system runs on Epochs, each ending on the last day of the calendar month. After the system snapshot on the 2nd of the following month (00:00 UTC), rewards are calculated and become available for manual claiming in the Personal Center.

The inaugural incentive cycle spans 6 Epochs (6 months), during which Lorenzo will release $BANK monthly to incentivize authentic product use, long-term locking, and early contributions. Specifically:

• Monthly Release: 9,916,667 BANK per Epoch (about 0.47% of total supply).
• Cycle Total: 59,500,002 BANK by the end (about 2.82% of total supply).

These releases are split as follows:

• 60% to Season 2 Lorenzo Points: For real engagement in OTF and Earn (DeFi Vault) products.
• 20% to veBANK (BANK Boost): To encourage locking and governance boosts.
• 20% to yLRZ: Loyalty rewards for early supporters, amplifying long-term effects.

These three modules run in parallel within the same Epoch and share the monthly emissions as above. This allocation balances immediate participation with future-oriented commitments, creating a flywheel of value for the entire ecosystem. This 6-Epoch program is the initial phase; future cycles may evolve with governance and product rollout.

Launch & Epoch Timeline

As Proof of Commitment (PoC) goes live with this release, the launch month will be treated as Epoch 1.

Because PoC is introduced partway through February, Epoch 1 is unique. It will begin on February 10th at UTC 00:00 and run until February 28th at UTC 00:00, at which point it will be settled to conclude the Epoch.

All users’ OTF participation prior to the Epoch start will be counted as retroactive points, and these retroactive points will be settled in the 1st Epoch.

All subsequent Epochs will also follow a standard calendar-month schedule, starting on the first day of the month at UTC 00:00 and ending on the last day of the month at UTC 00:00. Epoch 2, for example, will run from March 1 UTC 00:00 to March 31 UTC 00:00.

Season 2 Lorenzo Points: The Foundation of Participation

At the heart of the system is Season 2 Lorenzo Points, which track and reward your genuine activity across Lorenzo's products. Unlike the previous fixed daily point system, Season 2 Points are now directly tied to the real economic value of your participation.

Points are calculated based on the actual value of assets you hold in each product, using the product's Net Asset Value (NAV) as the standardized valuation reference. This design ensures that point accumulation accurately reflects the scale of your holdings and real usage behavior; the more value you actively commit to Lorenzo products, the more points you earn.

What is Live and Earning Points?

• sUSD1+ OTF Base Points
• BNB+ OTF Base Points
• PancakeLP Earn Vault Boosters
• Unified Referral Rewards

How Base Points Are Calculated

We use tailored benchmarks for different OTF types, but the logic is uniform:

• USD1-based OTF: 1 Point = 1 USD/Day
• BNB-based OTF：1500 Points = 1 BNB/Day

For example:

• In sUSD1+ OTF, daily points = Your sUSD1+ balance × Daily sUSD1+ NAV (mirroring your holdings' USD value).

When you move assets into Earn Vaults (e.g., Pancake LP Vault), you get a booster:

• Daily Points = Vault Token balance × Vault Token NAV × 1.5 (a 1.5× multiplier on base value).

Your total daily points? Simply the sum across all products: OTF base + Vault boosts.

Reward Pools

sUSD1+ OTF & related Earn Vaults (e.g., PancakeLP): All USD1-related products share the sUSD1+ OTF reward pool. Rewards are distributed based on points, which accrue according to their USD-denominated value.

BNB+ OTF & related Earn Vaults: All BNB-related products share the BNB+ OTF reward pool. Rewards are distributed based on points, which accrue according to their BNB-denominated value.

60% of monthly BANK emissions (Season 2 Lorenzo Points) are allocated across OTF products based on TVL, and then distributed to users based on points. Here, user rewards are calculated based on their share of each OTF's total points pool.

In the future, once governance is live, the community will be able to vote on reward allocation via veBANK.

Unified Referral Rewards: Grow Together

Every wallet gets a unique referral code, usable across all Lorenzo products—current and future.

• Inviter: 20% of the invitee's total daily points.
• Invitee: Extra 5% on their own total daily points.
• Activation: Rewards activate only after the invitee makes a single, lump-sum deposit of at least 20u. Multiple smaller deposits (for example, 5u + 10u + 5u) do not count toward activation. The 20u must be deposited in one transaction.

These are settled daily, added to your Lorenzo Points, and ongoing, as long as the invitee stays active."Total Points" here means OTF base + Vault multipliers.

Referral Points Example:

Assume Alice invites Bob using her referral code.

• Bob deposits $20+ into a Lorenzo product, activating the referral.
• On a given day:
  • Bob earns 100 total daily points from his activity (OTF base + Vault multipliers).
  • As the invitee, Bob receives an extra 5%, giving him 105 total points for the day.
  • As the inviter, Alice earns 20% of Bob’s original daily points, which equals 20 points.
• Outcome -
  • Bob’s points: 100 base + 5 bonus = 105 points
  • Alice’s referral points: 20 points

Timing & Reset Rules

• Daily Settlement: Points settle daily at 00:00 UTC. View progress in your Personal Center
• Monthly Snapshot: Each Epoch ends at month-end. A monthly points snapshot occurs on the 2nd of the following month (00:00 UTC).
• Reset & Rewards: After the snapshot, previous Epoch points are cleared (Points earned on the 1st of the month will not be cleared by the system and will automatically be carried over into the new Epoch), and rewards become claimable.

Pro tip: More points = bigger share. Your final $BANK depends on your proportion in the pool.

Retroactive Points: Honoring Past Participation

We've back-calculated base points for historical activity in OTF products. View them in your Personal Center. They're preserved and count toward the first Epoch.

veBANK: Governance Power and BANK Boosts

veBANK turns your long-term commitment into governance weight and reward eligibility.

Core: Time-Weighted Decay

• Formula: veBANK = number of locked BANK * (remaining locking time/maximum locking time)
• Maximum lock-up period: 4 years (209 weeks). Weight decays linearly to zero over time.

Distribution: Monthly Budgets, Weekly Snapshots

veBANK holders will receive BANK Boost pool rewards based on their position ratio. Users must lock their positions 2 weeks in advance to complete the activation process, and the unlocking time must be equal to or later than the third Thursday after the snapshot (i.e., snapshot day + 3 weeks).

Distribution follows these rules:

• Epoch-based: Rewards are calculated on an Epoch basis.
• Rewards are calculated in cycles.
• Weekly snapshot (Thursday 00:00 UTC): Only used to confirm eligibility and calculate veBANK weights.
• Calculation formula: User's Current Distribution veBANK / Total Current Distribution veBANK) * BANK Boost pool amount.

Activation: Confirmation Process

veBANK Activation & Reward Timing

New locks do not take effect immediately. To be eligible for reward distribution, veBANK must satisfy both of the following conditions:

1. Two-week activation rule: The position must have passed through two Thursday snapshots (Pending and Transition states).
2. Unlock time requirement: The unlock time must be on or after the third Thursday following the snapshot.

Unlock Time Example:

• If a position participates in the Feb 12 (Thu) snapshot → Unlock time must be ≥ Mar 5 (Feb 12 + 3 weeks).
• If a position participates in the Feb 19 (Thu) snapshot → Unlock time must be ≥ Mar 12 (Feb 19 + 3 weeks).

Timeline demonstration (Example: Assuming locked position on Wednesday, February 11th)

February 11th (Wednesday): Lock position, create positioning, and display My veBANK real-time weight (display only, not involved in allocation)

February 12 (Thursday): The first snapshot, status: Pending

Please note: The positioning unlock time must be ≥ the third Thursday after the snapshot (i.e. ≥ March 5th 00:00 UTC).

February 19 (Thursday): 2nd snapshot, status: Transition

February 26th (Thursday): Third snapshot, status: Active. The weight is officially included in Current Distribution veBANK. Rewards are calculated immediately after the snapshot and enter TOTAL AVAILABLE. Users can then claim the reward. There is no need to wait for a separate system distribution date.

Key Metrics on Your Dashboard

Dashboard Key Metrics

• My veBANK: Real-time weight (total of Pending, Transition, and Active positions).
• Current Distribution veBANK: Eligible weight for the current cycle (Active positions only).

yLRZ: Loyalty for Early Believers

yLRZ rewards early participants from the Babylon Staking Campaign's Cap 1 and Cap 2 with extra $BANK, linking previous activity to new ecosystem actions like OTF or veBANK participation. These rewards are distributed monthly, comprising 20% of total PoC emissions for each epoch, with unreleased allocations rolling over to future epochs (already-claimable rewards do not roll over).

Rewards Cap

Each user has a fixed lifetime yLRZ cap. The total lifetime maximum rewards a user can receive are calculated as: user’s individual yLRZ share × the total prize pool (Cap 1 or Cap 2).

Rewards Per Month

yLRZ rewards are distributed monthly （by epoch) according to the following structure:

1. Monthly yLRZ pool:
Each month, 20% of that month’s total PoC rewards is allocated to the yLRZ pool.

2. Your share of the pool:
Your monthly yLRZ amount is determined by your points share (%).

In our previous blog that gave a preview to yLRZ reward distribution, rewards were distributed based on each user’s personal $BANK yield from participating in new products. We’re now updating this to a points-based model to improve the experience.

yLRZ rewards will be calculated based on the Lorenzo Points users earn in each Epoch through the actions listed below.

Points used for yLRZ rewards calculation come from:

• OTF Base Points
• Referral Points
• DeFi Boost (e.g., Earn products)
• Performance Incentives (not live yet)
• veBANK Points: snapshotted on the 2nd of each epoch, 1 veBANK = 1 point (will not be shown separately)

The calculation formula is: User yLRZ = Reward Pool × (User Weighted Points / Total Weighted Points)

Important: Points from different asset pools will be weighted and normalized for fairness.

Example Scenario

If a user’s lifetime cap is 100 BANK, but their calculated share for a given month is 150 BANK, the user will simply receive 100 BANK, and their yLRZ allocation will be fully capped.

Important Notice

After the PoC system goes live, users are required to claim yLRZ in the Personal Center before the yLRZ reward calculation can begin.

If yLRZ is not claimed, your points earned during that period will not be counted toward yLRZ reward calculations. Only points earned from the day yLRZ is claimed onward will be used to calculate yLRZ rewards for that Epoch. Please note that this requirement applies only to yLRZ rewards. All other systems, such as Season 2 Lorenzo Points accumulation, are not affected.

Claim Rules for all rewards

veBANK Bank Boost rewards settle every Thursday.

All other rewards are finalized after a system snapshot at 00:00 UTC on the 2nd of the following month. At that time, the previous month’s points are cleared (excluding points earned on the 1st), and Season 2 Points and yLRZ rewards become available for manual claiming in the Personal Center.

Unified Cycle Timeline:

• Month-End: Epoch concludes.
• 2nd of Following Month (00:00 UTC): System snapshots → Previous points reset (excluding current 1st) → Rewards calculated → Claims Open.
• Post-Settlement: Rewards remain claimable in the Personal Center for 180 days.

All rewards across Season 2 Points, and yLRZ follow these essential rules:

• Rewards are 100% claim-based — nothing is auto-distributed or auto-sent to wallets
• Claim window: 180 days from the date the rewards become claimable in the Personal Center.
• After 180 days, any unclaimed rewards are permanently marked as “Missed” and cannot be recovered
• veBANK Bank Boost rewards have no 180-day claim limit, users can claim anytime.

Important Note For yLRZ

yLRZ rewards are subject to the same 180-day claim window.

If you fail to claim your yLRZ rewards within 180 days after they become claimable, that portion of yLRZ will be permanently marked as “Missed” and cannot be recovered.

This applies even if the rewards were part of your lifetime yLRZ allocation. However, unclaimed rewards only affect the portion that was already released and claimable. Any remaining, unreleased yLRZ allocation for future Epochs is not impacted.

Wrapping Up: Join the Lorenzo Revolution

Proof of Commitment is more than a rewards program. It's the foundation of our community-powered future. By locking $BANK and participating, you’re doing more than earning; you’re shaping the protocol’s direction through governance and growing alongside it.

Dive in today! Check your Personal Center, lock BANK, refer friends, and watch your contributions grow over time.

Get started: https://app.lorenzo-protocol.xyz/personalCenter

Stay updated via official channels for Epoch settlements, dashboard enhancements, and claim guides.