cPoL Model Explained
Last updated
Last updated
The core of SonicSphere’s architectural logic lies in its Complete Protocol-Owned Liquidity (cPoL) model, a novel evolution and adaptation of traditional Solidly-based protocols. While most Solidly forks operate as DEXs dependent on third-party liquidity providers and mercenary capital, SonicSphere redefines the model entirely. By owning its liquidity outright, SonicSphere establishes itself not as a DEX, but as a self-sustaining decentralized hedge fund, delivering consistent returns and long-term value to gSPHERE holders.
Traditional ve(3,3) DEX models rely on attracting external liquidity providers who are incentivized through high emissions and short-term farming rewards. This results in:
Mercenary liquidity, which leaves as soon as rewards diminish.
Unsustainable emissions to maintain TVL and trading volume.
Liquidity depth that is volatile and unpredictable.
SonicSphere’s cPoL model eliminates this dependency. Instead of leasing liquidity from outsiders, SonicSphere acquires and owns yield-bearing assets directly through its Auction Gauges. These assets are permanently protocol-owned and deployed to generate yield, whic is automatically liquidated in an autonomous fashion, with value distributed back to governance holders. This approach ensures long-term capital stability.
Where most ve(3,3) models revolve around a DEX and swap fees, SonicSphere does not function as a DEX. Its focus is on curating a diversified, yield-bearing treasury of Sonic-native assets, such as:
LP tokens
Liquid staking tokens (LSTs)
Lending protocol assets
GameFi and other emerging asset classes
This makes SonicSphere the first ve(3,3)-inspired ecosystem detached from a DEX, creating a protocol-owned yield fund rather than a fee-reliant exchange.
In most ve(3,3) models, emissions are directly tied to incentivizing liquidity provision, often leading to:
Dilution of token value through inflationary emissions.
Emissions outpacing protocol revenue, making them unsustainable.
SonicSphere’s emissions come in the form of oSPHERE call options, which are perpetual, non-expiring call options on SPHERE. Because the strike price is always equal to the floor price (backed by $S), oSPHERE emissions are intrinsically valuable and always “in the money.” This mechanism creates demand-driven emissions that align incentives and eliminate inflationary pressures—providing a stable, self-reinforcing reward system for gSPHERE holders.
The cPoL framework ensures that SonicSphere is not reliant on borrowed liquidity, temporary incentives, or external capital. Every asset acquired through the Auction Gauge system is permanently owned by the protocol, ensuring:
Constant yield generation, regardless of market cycles or outside participation.
A self-sustaining treasury that grows over time.
Emissions that are backed by real, protocol-owned yield—not speculation or mercenary TVL.
This creates a perpetually sustainable ecosystem, where the growth of the protocol is directly correlated with the strength of its treasury and the yield it generates—not external market conditions.
By removing the need for external liquidity providers and focusing on protocol-owned assets, SonicSphere’s cPoL model:
Creates predictable, stable liquidity without volatility.
Aligns emissions with actual protocol revenue and value accrual.
Ensures gSPHERE holders benefit directly from treasury growth.
Makes SonicSphere immune to mercenary behavior, setting a new standard for DeFi sustainability.
