Aerodrome Liquidity Incentives Update

Hi all,

Upon the passage of the proposal to promote Warden Finance as liquidity manager for Aerodrome, we wanted to report to the community our plan for the launch period.

Schedule for Aerodrome launch is the following:

Date Event
Aug 29 00:00:00 UTC Aerodrome launch
Airdrop for veVELO Lockers
Aug 30 23:00:00 UTC Voting and incentives period for epoch #1 ends
Aug 31 00:00:00 UTC AERO token launch
Epoch #1 starts (7 days duration)
Sep 08 00:00:00 UTC Epoch #2 starts (7 days duration)

As AERO token is not currently launched and no historical data in regards to incentive returns is available, we currently cannot accurately predict the expected returns of any given allocation. With this consideration, we are targeting an allocation for the first epoch that is sufficient to place WETH-WELL pool amongst the most rewarded pools, yet conservative enough to prevent diminishing returns.

As of August 29 18:00:00 UTC, we have set incentives to 1% of total allocation or 527k WELL / $2,950. The allocation currently sets WETH-WELL as top 4 most incentivized pools.

We will keep monitoring activity until the period ends and may readjust the allocation if necessary.

2 Likes

We wanted to provide an update to the community in regards to our actions for epoch 0

Firstly, the WELL allocation was matched with ~100k AERO (~$34k) incentives grant from the Aerodrome launch partner program.

Secondly, during the last hour, we’ve increased the allocation from 527k to 1.58M WELL ($3000 → $9,000) to attract the remaining 100M votes (~22% of total). Voting on WETH - WELL gauge moved from 0.4% to 1.66% following the increase in incentives.

Here’s the current status of the pool.

Results

As a result of the launch of the new WELL liquidity pool on Aerodrome, token liquidity has been dramatically improved. 5% depth to sell WELL on Base is currently more than 10X the depth on Moonbeam ($1.7k → $23.5k).

WELL on Base


WELL on Moonbeam



Aerodrome TVL is currently standing at $171M a few days after launch, which makes it the largest protocol on Base by far ($150M more than Overnight Finance, in 2nd place with $23M).

Base chain TVL also has dramatically increased from $190M to $333M (+75%), which is also great news for Moonwell lending markets.

Next steps

In order to maintain WELL liquidity on the longer term, we will ensure rewards are attractive enough for LPs to stick with WETH - WELL.