Vesper Finance
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Vesper Finance

This Week: Updating Vesper’s Tokenomics for a Successful, Sustainable Future

Also: Something exciting is coming to Vesper Orbit!

Tokenomics Overhaul

Vesper announced a series of proposals outlining several changes to Vesper’s tokenomics structure. These Vesper Improvement Proposals (VIPs) will be voted on early next week.

Here’s an overview…

Vesper has identified areas of growth required to position the platform for long-term success:

  • Fee Structure and Revenue Model — the fee structure is outdated and not user-friendly. Funds need a prolonged period in the pool to avoid incurring a penalty upon withdrawal. For protocol-level integrations, this makes Vesper incompatible. Ultimately it leads to low and unpredictable revenue for the ecosystem.
  • Token Supply and Liquidity — the highly incentivized pool and liquidity pool staking rewards were a speedy growth hack, leading to long-term treasury management and liquidity concerns.
  • Long-term VSP Incentives — there are few incentives for holding VSP long-term, leading depositors to sell their earned VSP as soon as it is accrued.
  • Sustainability — Vesper Brewing Co Ltd is currently supporting Vesper’s development with expenses totaling on average $419K monthly. Long-term, the Vesper DAO should be sustainable and be supporting the continued growth and development of Vesper.

Proposed solutions to these challenges are detailed in three VIPs:

New Fee Structure

This proposal introduces Withdrawal and Interest Fees as well as a Universal Fee.

The Universal Fee will charge a 2% annual fee on the assets deposited (principal) at the time of rebalance. If this fee is greater than 50% of the interest earned, then the fee will only equate to 50% of the interest earned.

Here’s how the model looks in practice:

View the full VIP.

Sunset vVSP, Introduce Locked VSP

This proposal replaces vVSP with a new VSP lockup program, introducing long-term incentives for holding and locking up VSP.

Here’s how it works:

View the full VIP.

VSP Bonding

This proposal introduces Bonding with Guardrails by establishing rules for when minting will be enabled and VSP will be exchanged for LP tokens or stablecoins.

Here’s how it works:

View the full VIP.

Join the Discussion

Voting for the VIPs will open on Thursday, April 7. We’ll share reminders as the event nears.

In the meantime, join the discussion on Vesper’s governance board or on Discord!

Coming Soon: Ape in with Vesper

DeFi participants will soon be able to passively grow their ApeCoin holdings with Vesper Orbit!

Vesper Orbit enables users to gain exposure to the most exciting DeFi projects, while delivering the simple-to-use experience and rigorous safety and audit standards that Vesper is known for.

Get notified when this goes live.


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Vespernauts Shazia and Errin contributed to this report.



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Vesper Finance

Vesper Finance

Vesper is a platform for easy-to-use DeFi products.