Incentive Model Proposal for Arbitrum Deployment


As part of the multichain expansion, Venus Protocol aims to create an active and engaging community on Arbitrum by introducing an incentive structure that rewards both liquidity providers and borrowers.

Key points of the plan:

  • Market Emissions: 25,500 XVS will be allocated to the first quarter as liquidity incentives.
  • XVS Vault Base Rewards: 4,500 XVS will be allocated quarterly for the Arbitrum vault, with an additional 10% from the protocol reserves on Arbitrum from the previous quarter as per tokenomics starting from Q4.
  • Bootstrap Liquidity on Uniswap: 1,500 XVS and 5 ETH will be used to provide liquidity on Uniswap.
  • Multichain Development Grants: 3,000 XVS allocated for community-driven multichain and cross-chain expansion.

Incentive Structure

In the first quarter of Venus Protocol’s multichain deployment, the distribution of XVS emissions across is aligned with competitive TVL distributions.

Table 1: XVS monthly distribution

Chain/Quarter Month 1 Month 2 Month 3 Total Distribution (%)
Arbitrum Markets 8,500 8,500 8,500 25,500 85
Arbitrum XVS Vault 1,500 1,500 1,500 4,500 15
Total 10,000 10,000 10,000 30,000

Table 2: XVS monthly distribution per market

Pool Market M1 Allocation M2 Allocation M3 Allocation Total Allocation Distribution (%)
Core ARB 425 425 425 1,275 5
Core ETH 425 425 425 1,275 5
Core BTC 850 850 850 2,550 10
Core USDT 850 850 850 2,550 10
Core USDC 850 850 850 2,550 10
LST ETH wstETH 850 850 850 2,550 10
LST ETH weETH 850 850 850 2,550 10
LST ETH ETH 3,400 3,400 3,400 10,200 40
Total 8,500 8,500 8,500 25,500 100

Table 3: Proportional distribution for supply and borrow

Pool Market Supply Borrow
Core ARB 40% 60%
Core ETH 40% 60%
Core BTC 40% 60%
Core USDT 40% 60%
Core USDC 40% 60%
LST ETH wstETH 100% 0%
LST ETH weETH 100% 0%
LST ETH ETH 30% 70%
  • This incentive structure may be adjusted based on market conditions, as well as continuous analysis and results.

XVS Vault Base Rewards

Venus Protocol will maintain its commitment to the XVS vault rewards, for the new Arbitrum vault deployment. Each quarter, a base reward of 4,500 XVS will be allocated to vault rewards, with an additional 10% of the protocol reserves added from the third quarter onwards.

Table 4: XVS Vault Base Rewards for Arbitrum (XVS)

Quarter (2024) Rewards
Q1 4,500 XVS
Q2 4,500 XVS
Q3 4,500 XVS + 10% of Q2 Reserves
Q4 4,500 XVS + 10% of Q3 Reserves


The emissions schedule was calculated based on the market proportions on the Ethereum Mainnet. Furthermore, the allocation weights were distributed based on market performance on ETH in terms of Market Size and Total Borrow Amounts.

Uniswap Bootstrap Liquidity

With the new XVS vault to be soon enabled on Arbitrum for Venus Prime and Governance, this proposal aims to provide liquidity with 1,500 XVS and 5 ETH to seed a pair on Uniswap and ensure a smooth start. This Uniswap liquidity pool will be available on Mainnet for users and partners to participate in.


Venus needs Arbitrum! Venus team quickly deploys to arbitrum

1 Like

The phrase comes to mind: a small step for man, but a huge leap for mankind.
In our context: a small step towards multichain, but a huge leap for the entire Defi infrastructure.

the plan for arbitrum xvs vault is contain q1 and q2, but this chain is start with q3. may be more xvs emissions for q3 and q4

I am very impressed with the recent multichain expansion proposal from Venus Protocol and its focus on Arbitrum. The incentive structure designed to reward both liquidity providers and borrowers is an excellent initiative that I believe will significantly strengthen our community. The allocation of 25,500 XVS for market emissions and the XVS Vault base rewards of 4,500 XVS quarterly, along with the additional 10% from the protocol reserves, demonstrate a solid commitment to the growth and sustainability of the protocol.

Furthermore, the initiative to provide initial liquidity on Uniswap with 1,500 XVS and 5 ETH is a strategic step that supports Venus’s vision to facilitate a smooth start on Arbitrum. I also applaud the allocation of 3,000 XVS for multichain development grants, which underscores the importance of community-driven innovation and cross-chain expansion.

In summary, I agree with and am satisfied with the direction Venus Protocol is taking and with the proactive measures to ensure its success in the multichain ecosystem. I look forward to the opportunities these new initiatives will bring to our community!

I think Venus protocol need arbitrum, not zksync era!!