Venus Protocol Weekly Update W28/2021

Venus Protocol Weekly Update W28/2021

Dear Venus Community,

Yes, we are, as you can tell, still in the progress in reassembling the team to the full speed of development. As people in crypto said, “Slowly but surely”. We sincerely apologize for the slowness of the process and appreciate your patience.

We now resume the weekly update, hoping to share short but concise and meaningful information with the community.


We are still confirming the details of the token economy. There are larger voices to keep the multi-coin model, but none of the current proposals (1, 2 or 3) are ideal to solve all the problems.

For example, the Dev team wants to frankly share with you that Oracle providers (as Chainlink) cannot provide reliable price feed for VRT as its liquidity is not enough. We know it is a chicken and egg problem, but VRT cannot be added as collateral at this time. At least, not in the near future.

It will still take a while to iron out all the issues. We will inform and adjust along the way as we develop.


XVS Vault

As it is widely agreed to stop the rewarding for XVS borrowing (and eventually stop all the XVS borrow), we actually are trying to introduce a fundamental vault mechanism to facilitate other features besides the asymmetric reward rate adjustment.

The code and doc are being written now and the doc will be shared soon.

One problem we met here is the size of the Comptroller contract, which is too large. We have to either optimize it down or decompose it into several.

New Token Markets & Risk Assessment Framework

MATIC has been added as the new token to supply and borrow this week.

CAKE will be the next token to be proposed to add.

The new risk control team has articulated our basic Risk Assessment Framework for Venus, which is supposed to evolve into the widest coverage for the lending market in DeFi. This will introduce the next wave of tokens to be proposed to add.


The dev team will continue to work on the XVS Vault feature. Meanwhile, other changes we want to introduce.

Waive Redemption Fee

The team recommends upgrading the revenue model for Venus protocol and is considering waiving the 0.01% redemption fees. The future income is planned to come partially from interest rate reserve and also liquidation fees (out of the current liquidation incentives).

Improve Interest Rate Curve Model

The interest rate curve should be more dynamic and sensitive to token usage, especially for the more risky tokens. New curve models will be introduced and 2 tokens will be proposed as pilot.

Upgrade of the Guardian Management

Some of the guardians are still managed by EOAs (Externally Owned Accounts), which are controlled by private keys. They will be upgraded to a multi-sig EOA based on Threshold Signature Scheme first, and later moved to Timer Lock contract and managed by Governance.

Shortfall Recovery

The team noticed that the community has different opinions on how to recover the shortfall. After comparison, we still believe the VIP-29 is still the most direct guarantee to recover the supply without bringing more complexity.

We are still working together with Binance team to ensure the interest of XVS holders and the community is protected at the best. All the following actions will be transparent to the community.

With that said, as the bailout will last for a long time (9-12 months), we also have the deal with Binance to change the plan at any time when a better and simpler alternative is available.