[ZKsync] XVS Incentives Model Proposal

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

Key points of the plan:

• Market Emissions: 30,000 XVS will be allocated to the first 4 months as liquidity incentives.
• XVS Vault Base Rewards: 6,000 XVS will be allocated for the first 4 months for the ZKSync vault, with an additional 20% from the protocol reserves on ZKSync from the previous quarter as per tokenomics.
• Bootstrap Liquidity on DEX: 1,500 XVS and 5 ETH will be used to provide liquidity on DEXs.
• Multichain Development Grants: 3,000 XVS allocated for community-driven multichain and cross-chain expansion.

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

DEX Bootstrap Liquidity With the new XVS vault on ZKSync for Venus Prime and Governance, this proposal aims to provide liquidity with 1,500 XVS and 5 ETH to seed a pair on DEXs and ensure a smooth start.

Multichain/Cross-Chain Development Grants Venus Protocol is launching a Multichain/Cross-Chain development grants program to boost its cross-chain deployments. With a 3,000 XVS budget, this initiative aims to encourage community participation in multichain development, either via RFPs or strategic funding opportunities. This will support Venus’s innovation and expansion across different blockchain ecosystems.

Conclusion In conclusion, following the successful deployment for Ethereum and Arbitrum, Venus Protocol is now applying a similar strategy for ZKSync. This includes allocations of 30,000 XVS for liquidity incentives, 6,000 XVS for vault rewards, 3,000 XVS for multichain development grants, and 1,500 XVS & 5 ETH for bootstrapping DEX liquidity. This strategy, with its focus on gradual emissions to encourage user retention and loyalty, is designed to expand Venus’ participation across the DeFi ecosystem.