# The Treasure Hunt Season 1 (ended)

How the Hook Treasure Hunt distributes chests.

Season 1 of the Treasure Hunt ended on August 20, 2024. Season 2 is coming in October. More information will be shared about Season 2 closer to its launch. Information on Season 1 (ended) is below.

**The Treasure Hunt is Hook's points program. **Treasure Chests are awarded by opening positions (both market and limit orders), providing liquidity on Odyssey's orderbook, and via invites. Each Treasure Chest has the same value.

To learn more about the Treasure Hunt in simple terms, please visit our announcement post. This document contains technical details of the system for traders interested in specifics. The easiest way to be rewarded with chests is by depositing into Odyssey's Pools.

## How Treasure Chests are rewarded

The internal system distributes Treasure Chests automatically by processing a fixed flow of chests, not manually as in some other products.

There are three categories of chests, and the system distributes a fixed 175,000 chests/day. The allocation between these categories varies, and are reported here with their initial value in June 2024.

Allocation | Category | Details |
---|---|---|

10% | Invites | Chests distributed for inviting other users |

30% | Volume | Chests distributed based on trading volume |

60% | Liquidity | Chests distributed based on liquidity provisioning |

### Invite Chests

Users receive invite chests based at a rate of 10% of the number of chests their invitees receive from Volume and Liquidity, until the end of Season 1 of the Treasure Hunt. If my invitee receives 10 chests, I will get one.

Invite chests are only distributed for qualifying use of the protocol. Specifically, invitees may qualify by:

Trading a minimum of $10,000 in notional volume on the protocol

Depositing a minimum of $500 into a liquidity pool

Placing a minimum of 10 orders that are partially filled or filled.

Invitees may only be invited by a single user. An inviter will receive a maximum of 200,000 chests from an individual invitee.

Invite chests are distributed after the Volume Chest computation, Liquidity Chest computation, and Pool re-distribution are completed, and therefore account for chests earned by invitees only in that category. Any chests not distributed each day are retained by the protocol for future use.

### Volume Chests

The protocol distributes chests to users daily at midnight UTC based on their trading volume in the past 24 hours.

The number of chests per day is computed as follows:

Where:

`w_t`

is the weight corresponding to the proportion of chests allocated to the volume-based chest distribution.`alpha_c`

is the asset multiplier, which corresponds to a weight for each pair.`A_u,c`

are the chests a user earns within an individual asset.`C`

the set of all assets trading on Hook Odyssey.

The chests a user receives each day from each asset is the weighted sum of the Sustainability Index and the Market Bias Index:

The weights `w_S`

and `w_MB`

correspond to the split between the two categories.

The Sustainability Index assesses the long-term sustainability of the trades for the ecosystem. It is computed as a weighted amount of fee revenue.

Where:

`Fees_t`

are the transaction fees generated at the time`t`

by the user`u`

on asset`A`

`m_tier`

is the internal multiplier based on fee tiers to compensate higher fee tiers for receiving fewer chests for the same volumes.

The Market Bias Index rewards users for taking and holding less popular positions. The popularity of positions is determined by the smoothed funding rate mechanism integral to perps.

Where:

`F_t`

is the funding received at time`t`

by the user`u`

on asset`A`

### Liquidity Chests

Liquidity chests are distributed to users based on the liquidity provided on Odyssey's orderbook in each pair. Liquidity chests are distributed based on the theory that a Limit Order placed closer to the mark price is filled first, with a higher probability of being filled.

Chests are distributed continuously, and linearly, to users based on random samples of the orderbook. At each sample, the chests distributed to a user for placing an individual order are computed:

Where:

`c_i,t`

is the limit price of the order.`Q_t(c_i,t)`

is the total size of all limit orders placed by any user with the same price in the orderbook.`Q_i,t(c_i,t)`

is the size of of the individual user's order.`m_t`

is the current mark price of the instrument.`D_i,t`

is the effective book depth prior to the individual order execution:

With:

`RV_t`

is the hourly close-close realized volatility in the past 48 hours.

The chests are adjusted at sample time to ensure that each market linearly emits the correct number of total chests each day.

### Pools

After the daily chest distribution, all chests distributed to each pool in the prior 24 hours are distributed pro-rata to pool depositors who had deposited over that period.

## Seasons

Seasons correspond to epochs of the Treasure Hunt. The rules of the Treasure Hunt will stay constant for the duration of a season. Boosts, like invites, generally only persist for a season. Users can expect announcements related to mechanism changes to occur at the end of a Season.

## For Previous Hook Traders and Option Writers

Traders and options writers on Hook’s fully collateralized call options protocol were rewarded Treasure Chests with different rarities.

All Treasure Chests previously rewarded will be converted to Odyssey Treasure Chests using the rarity muliplier of the legacy chests.

You can see your previously earned chests in the ‘Rewards’ Tab.

## For Odyssey Preview Traders

Past users of Odyssey have also been rewarded with chests based on usage. You can see previously rewarded chests in the 'Rewards' Tab.

Last updated