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Incentives Policy & AAVE Reserve
Protocols are competing for liquidity by incentivizing depositors through the means of protocol tokens issuance. The Aave Protocol will also incentivize its users through a scheduled distribution to benefit liquidity providers and users through the Protocol Ecosystem Incentives from the Aave Reserve.
The total supply of AAVE is 16M, of which 13M are redeemable by LEND holders with a ratio of 100 LEND per 1 AAVE.
The remaining 3M will be allocated to the Aave Reserve and controlled by the AAVE token holders, to incentivize the Aave Ecosystem growth and development.
- AAVE Safety Incentives,
- AAVE Liquidity Incentives.
The reserve factor allocates a share of the protocol's interests to a collector contract as reserve for the ecosystem. This reserve is new to V2, used to sustain the DAO and pay protocol contributors. It is made out of various assets including AAVE.