Stake DAO Tokenomics Update: Migrating from veSDT to vlSDT

Stake DAO has announced a major tokenomics and governance upgrade, phasing out its existing veSDT vote-escrow model and migrating to a new vlSDT (vote-locked SDT) system, with on-chain migration already underway. The change affects how SDT holders lock tokens, earn rewards and bribes, and participate in protocol governance, and is framed as a simplification and modernization of Stake DAO’s incentive structure. According to Stake DAO’s migration blog, veSDT is being deprecated and replaced by vlSDT, a new locking mechanism designed to be more flexible and aligned with the protocol’s current focus on its Liquid Lockers product suite. Under the previous model, SDT holders locked tokens to receive veSDT, which conferred governance power and access to yield and bribe flows across Stake DAO products. The upgrade consolidates and streamlines these rights under vlSDT, with a formal migration path for existing veSDT holders and a deadline after which veSDT will no longer be supported. Stake DAO states that vlSDT is intended to improve governance efficiency and better match incentives for long-term participants in the ecosystem. Stake DAO reports that migration is progressing, with a public update noting that around 79% of outstanding veSDT had already been migrated to vlSDT as of 11 May 2026, representing roughly 34.75 million SDT staked in the new system. This shift matters for SDT holders because governance power, fee and bribe distributions, and strategic direction for Stake DAO’s liquid lockers—such as those for Curve and other governance tokens—will increasingly be driven by vlSDT rather than the legacy veSDT positions. For DAOs and protocols integrated with Stake DAO’s lockers, the change alters how they might acquire or influence SDT-based voting power going forward. "entities":["Stake DAO","SDT","veSDT","vlSDT","Stake DAO Liquid Lockers"]}`

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