Venus
Venus is a money market protocol that allows users to lend and borrow assets permissionlessly.
- Documentation
- Auditors
- Please see our FAQ on experienced auditors
- Website
- Token: XVS
- Tags: Lending
- TVL: $1.5B (Rank #16)
- TVL Ranking by Lending: #4
- Blockchain: Binance, Ethereum
- Chain TVL
- Binance: $1.51B
- Ethereum: $1.75M
- Code reviewed by at least one experienced auditor; CertiK audited in December 2020
- Public team promotes accountability
- One mitigated protocol hack since launch
- Core protocol launched in 2021; maturity over one year minimizes technical risk as smart contracts are well battle-tested
- Top 5% by total value locked reduces risk
- Multisig wallet controls protocol upgrades
- Multisig consists of less than 4 signers, which makes the protocol more susceptible to centralization risks
- Timelock is at least 48hrs, which provides users with sufficient time to exit if any malicious upgrades are approved
- At least one minor governance issue documented
- Low voting power concentration reduces risk
- No death spiral concerns
- Robust controls to mitigate oracle price manipulation
- Secured lending market that uses a combination of isolated and cross-collateral pools depending on the individual asset serves to reduce risk
- Solid controls in place to prevent risky borrowing
- Solid mechanisms in place to ensure healthy liquidations
- Robust methods to accrue protocol reserves
How Venus works
Venus consists of a decentralized system of lending pools. Users deposit assets they want to lend into a liquidity pool and borrowers draw from the pool when they want to take out a loan. Venus borrowers must first supply assets before they can borrow. Given the high volatility of crypto assets, borrowers must post more collateral than the value of the loan, or commonly referred to as overcollateralization. Interest rates on Venus are driven by market supply and demand. To facilitate this activity, Venus issues vTokens to lenders that reflect accruing interest on the underlying token.
How Venus makes money
Venus currently charges a reserve factor that allocates a share of borrowers' fees to the protocol. Each supported asset has a reserve factor that determines how much goes into the reserve.
How you make money on Venus
You earn lending fees on Venus by depositing your idle crypto assets to be used by borrowers looking for leverage. Venus also offers ongoing protocol incentives in its native XVS token to bootstrap demand for certain assets.
