$AARNA token design
> aarnâ token design
Last updated
> aarnâ token design
Last updated
Aarnâ’s native token, $AARNA, is designed to be a utility token for the protocol with multiple functionality in the different components of aarnâ. The protocol token will secure âtv vaults with a time lock mechanism, incentivize participation, create a community of the best minds in DeFi to be aligned with long term TVL build up, and to govern the protocol in a progressively decentralizing framework. $AARNA plays a crucial role in both governance and utility within the platform. As the native token of the aarnâ protocol, $AARNA serves to also integrate seamlessly with both the DAO and dApp. The fixed supply of $AARNA is set at 100 million tokens, with an initial price of $0.40 determined by the private seed round. aarnâ protocol adopts a hybrid governance model, combining on-chain and off-chain mechanisms. On-chain governance embeds rules directly into blockchain code, ensuring transparency and immutability.Off-chain governance handles decision-making outside the platform through communication and coordination. The hybrid approach leverages the strengths of both mechanisms, providing transparency, efficiency, and robust decision-making.
The $AARNA serves as the native currency of the aarnâ protocol, providing essential functions within both the DAO and the dApp. Key utilities of the $AARNA include:
Governance: $AARNA holders have the power to participate in the governance of the aarnâ DAO by locking their $AARNA for veAARNA, proposing and voting on key decisions that shape the platform's future. This ensures a decentralized and community-driven approach to protocol development.
Access to Premium Features: Holding $AARNA unlocks premium features within the aarnâ dApp. This includes early access to new vaults and exclusive insights, providing additional value and opportunities for active participants. $AARNA holders may be eligible for discounts on platform fees, further incentivizing participation in the aarnâ ecosystem. This makes it more cost-effective for users to engage with various services and features offered by the protocol. Access to premium features to be released.
Staking and Rewards: Users can stake their âtv tokens to earn additional rewards. The âtv Timelock program, a secure and flexible staking protocol, allows users to lock their âtv tokens for a chosen duration, earning rewards in return. Rewards are distributed in âtvStaking Reward Tokens (ASRT), which can be exchanged for $AARNA. A predetermined reward cap ensures fairness and transparency, with the ability to halt staking activities before the full 24-month period is met. The contract owner can adjust the cap and pause staking for specific tokens if necessary. Even if staking is frozen for underperforming vaults, users can still claim previously earned rewards. When a user unstakes, rewards are calculated based on the largest lock period at the time of unstaking.
Community Incentives: The aarnâ DAO may use $AARNA to incentivize community contributions. This includes bug bounties, content creation, and participation in governance initiatives, fostering a vibrant and engaged community that actively contributes to the protocol's development and success.
The protocol provides access to veAARNA tokens by locking $AARNA tokens. veAARNA tokens grant governance rights and a share in protocol revenue, with voting power and shares proportional to ve-AARNA token holdings. Off-chain votes are considered only if the threshold of on-chain votes is reached, ensuring a balance between transparency and efficiency in governance.
The fixed supply of $AARNA is set at 100 million units, which is then distributed between liquidity providers (capital deployers in âtv vaults), community members, investors, team and founders. The primary objective of the $AARNA distribution is to create a balanced and equitable allocation that promotes long-term growth, stability, and active participation within the aarnâ protocol ecosystem. By ensuring a fair distribution among the team, investors, and community members, the tokenomics are structured to incentivize early adoption, reward long-term commitment, and foster a decentralized governance model.
An allocation of 5% of the total token supply is dedicated to strategic partnerships, enabling the aarnâ ecosystem to collaborate effectively with influential entities in the blockchain and fintech sectors. These tokens support mutually beneficial alliances, incentivize long-term cooperation, and accelerate adoption by leveraging complementary strengths across ecosystems. This allocation ensures partners are meaningfully invested in the ongoing success and expansion of the protocol.
19% of the tokens are allocated to the founders and core team highlighting their crucial contribution to not only the project's conceptualization, design, development and growth, but also for self-funding it for over two years. This allocation incentivizes founders and core team, aligning their interests with the project's long-term growth and ensuring continuous strategic guidance and operational excellence
14% of the tokens are allocated to the treasury, managed by the protocol to ensure financial stability and support future initiatives, developments, and unforeseen needs. This allocation ensures that the aarnâ protocol can sustain its operations and continue to innovate.
35% of the tokens are dedicated to the ecosystem and community, reflecting the protocol's commitment to fostering a vibrant and engaged community. These tokens are used for reward distribution, staking, and launch plan initiatives, with specific lock-in periods and rewards designed to incentivize active participation and long-term commitment.
By dedicating a significant portion of tokens to the community and ecosystem, the protocol emphasizes the importance of a decentralized and participatory governance model. This approach aims to incentivize early adoption and reward long-term commitment, fostering an active community. The $AARNA distribution is designed to create a balanced and sustainable ecosystem, encouraging active participation from all stakeholders and supporting the long-term growth and stability of the aarnâ protocol.
Investors / Presale
Early seed investors and Presale, who provided the initial capital necessary to kick-start the project, are allocated up to 17% of the tokens, acknowledging their crucial support during the project's inception and early development. The seed round of the protocol has been valued at $40mn FDV, and more than $1Mn has been raised already, after the project being self-funded by the founder for over two years. This approach helps establish a diverse and decentralized token holder base. Given the protocol’s depth of technology and the large problem it is solving, and given the experienced team of aarnâ, multiple exchanges have expressed interest in the TGE.
A dedicated 10% of the token supply is reserved for securing and facilitating listings across major decentralized and centralized exchanges. This allocation ensures liquidity, enhances accessibility, and broadens market presence, enabling seamless trading experiences for the aarnâ community and driving wider adoption and recognition within the crypto ecosystem.
âtv Timelock & Staking Program is a secure and flexible staking plan designed for âtv vault users who deploy capital for accessing âtv vault strategies. This program rewards users with on top APY and pre-sale access to $AARNA. Users can lock âtv tokens for a chosen duration to earn these incentives, thus aligning longer term protocol liquidity (ie TVL growth). Early participants receive higher rewards in the form of higher APY (upto 25% / 1x based on the TimeLock), the rewards are proportional to the lock-up period and the âtv tokens locked by the users.
Rewards are distributed in the form of a shadow token, âtvStaking Reward Tokens (ASRT), which is non-transferable and does not hold any real value by itself but can be exchanged for $AARNA, which can be redeemed at market price or can be staked further to get $veAARNA, every ASRT token represents a fixed value of $10 USD. A maximum reward cap is present that ensures fairness by halting the Staking Program before 24 months after the beta period in case of TimeLock and for the Booster TimeLock the staking and reward accumulation will be paused by DAO, once the reward limit has been reached. The contract owner can adjust this cap and freeze staking for underperforming vaults. Frozen vaults stop generating rewards, but users can still claim earned rewards.
The token cycle in both the âtv Timelock & Staking program starts when a user deposits assets into the âtv vaults and receives the âtv tokens in return. These âtv tokens can then be staked in the âtv Timelock to earn additional rewards. The non-debit locking mechanism ensures that staked âtv tokens remain securely locked in users' wallets, preventing physical withdrawal during the staking period. Users can initiate the unstaking process to regain control of their âtv tokens and access their initial deposits. In the TimeLock, Rewards are calculated based on the longest lock period before unstaking. As a simple illustration, if a user invest in any âtv vault during the initial 3 month beta phase, and lock the âtv tokens for 6 months, then at the end of 6 month lock period the user will be able to redeem an APY of 15%, whereas if user unstakes only after 5 months then the APY will be calculated at the longest lock period before 5 months ie. 3 months, so user’s APY will be 12.5%. As for the Booster TimeLock, The rewards users earn during the lock period are based on the yield generated by the vault, multiplied by a factor determined by the length of the lock duration. For instance, if a user stakes âtv tokens for 8 months, they receive the on top rewards (in ASRT) based on the yield generated over those 8 months multiplied by 0.50, according to the table below. Longer lock durations offer higher multipliers, incentivizing long-term commitments that support protocol liquidity and growth.
TimeLock and Staking:
The figure illustrates the rewards offered by the âtv timelock & Staking program in terms of APY for the 12 month lock period changing with the token availability. The APY is calculated based on two factors: the lock date and the lock period. Users can get rewards at APY as high as 25% for lock period of 24 months, as higher rewards are given for longer lock-up periods. Lock-up periods are divided into intervals of 3 months, ranging the first year, and 6-month intervals for the second year, as given in Table 2.
The lock periods for âtv tokens are structured to reward long-term commitment with varying APY. This tiered reward system incentivizes extended lock periods, thereby promoting stability and sustained participation within the aarnâ protocol ecosystem.
Here is how the APY% is calculated:
Lock date - from launch
Beta 3m
1m
2m
3m
6m
9m
12m
24m
Lock date Factor
1.25
1
0.95
0.9
0.5
0.25
0.15
0.1
Lock period
3m
6m
9m
12m
18m
24m
Lock period Factor
1
1.2
1.3
1.5
1.75
2
Table 2: Factors for Lock date and Lock period
Let's take a simple example to understand the APY calculation, if someone comes in 3 months after the beta launch has ended and wants to lock for 9 months, then the APY will be calculated as:
APY% = (base âtv staking rewards %)*(Lock date Factor)*(Lock Period Factor)
So, in our case, APY% will be,
APY% = 10 * 0.9 * 1.3 = 11.7%
The base âtv staking rewards percentage is fixed at 10%, serving as a fundamental factor in the APY calculation.
Lock Date (from launch)
Beta (3m)
1m
2m
3m
6m
9m
12m
24m
â Token Rewards (Avg 12m lock, assume inv 100) APY%
18.75
15
14.25
13.5
7.5
3.75
2.25
1.5
â Token Rewards (Avg 6m lock, assume inv 100) APY%
15
12
11.4
10.8
6
3
1.8
1.2
â Token Availability for â_fi Lock
24%
8%
6%
5%
10%
9%
8%
30%
Table 3: APY rewards and â Token Availability with lock period.
However, it is crucial to understand that the rewards are not unlimited. A predetermined reward cap is established, and once this cap is reached, staking activities will cease prior to the completion of the full 24-month staking period. Ensuring no additional rewards will be available for distribution, thereby ensuring fairness and transparency throughout the process.
The figure illustrates the rewards offered by the âtv timelock in relation to the growth of the TVL, as the TVL grows and reaches upto a $100 million the APY rewards also reaches up to $3 million. It assumes that half of the TVL growth is locked for a period of 6 months, while the other half is locked for 12 months, indicating that the rewards are directly proportional to the TVL, and decreases as the time goes on giving the incentive to the early users.
Booster TimeLock and Staking:
The rewards users earn during the lock period are based on the yield generated by the vault, multiplied by a factor determined by the length of the lock duration. For instance, if a user stakes âtv tokens for 8 months, they receive the on top rewards (in ASRT) based on the yield generated over those 8 months multiplied by 0.50, according to the table below. Longer lock durations offer higher multipliers, incentivizing long-term commitments that support protocol liquidity and growth.
Lock Duration
Multiplier
3-6 month
0.25
6-9 months
0.50
9-12 months
0.75
12+ months
1
The figure illustrates the rewards offered by the âtv Booster timelock in relation to the growth of the TVL, as the TVL grows and reaches upto a $20 million the APY rewards also reaches up to $2 million. It assumes that half of the TVL growth is locked for a period of 6 months, while the other half is locked for 12 months, indicating that the rewards are directly proportional to the TVL.
At the time of the TGE, 10% of the total token supply will be allocated for Listing, and an additional 5% will be allocated for the Ecosystem and community. At TGE, approximately 18.85% of the tokens will be in circulation, with subsequent distributions occurring monthly. This method ensures a controlled and steady release, preventing market saturation.
The aarnâ token distribution is carefully structured to balance immediate availability and sustained growth. 10% is allocated for listing, fully unlocked at the Token Generation Event (TGE) to ensure liquidity and accessibility from the start. The Investors/Presale segment (up to 17%) releases a small portion (5%) at TGE, with the remaining 95% becoming available gradually over 18 months following a 6-month cliff, supporting long-term investor alignment. Any unused tokens from this allocation will flow into Treasury II.
The Ecosystem/Community and Treasury funds are divided into two parts each. Ecosystem/Community I (10%) and Treasury I (5%) provide immediate support, releasing half at TGE and the rest over the subsequent 5 months. Meanwhile, Ecosystem/Community II (25%) and Treasury II (9%) allocations vest entirely over 12 months, but only after a flexible cliff determined by the â DAO based on market conditions, providing adaptability to community and market needs.
For internal alignment, the Founders and Core Team (19%) have a structured, long-term vesting schedule: an initial 10% vests over 12 months after a one-year cliff, followed by the remaining 90% vesting linearly over 24 months after an additional two-year cliff. Additionally, Partnerships (5%) receive 10% at TGE, with the remaining tokens vesting over a year post a 6-month cliff, incentivizing strong ongoing collaborations.
