🪙About zkCRO, vETH, vUSD
About zkCRO, vETH, vUSD
Cronos zkEVM is partnering with Veno Finance to enable users to hold natively yield-bearing tokens when they hold crypto assets on the Cronos zkEVM blockchain.
Understanding zkCRO
zkCRO is a yield bearing version of CRO. It increases in value over time as CRO staking rewards are earned. It is minted on Ethereum directly from CRO, bringing the staking yield earned on Cronos POS into the Ethereum network. zkCRO is bridged to Cronos zkEVM, where it functions as the native token - the token that gas fees are paid in.
Backed by LCRO
All CRO deposited into zkCRO is migrated to Cronos POS, bridged to Cronos EVM via IBC and staked for LCRO. LCRO is a yield bearing token based on CRO. This provides the following advantages:
Leverage Liquidity: Users that wish to redeem their zkCRO for CRO, can receive LCRO almost immediately and can sell LCRO into the already existing Liquidity on Cronos EVM if they want to circumvent the unstaking period of 28 days.
Rewards Sharing: 50% of all validator rewards collected by Veno Finance through LCRO are returned back to VNO depositors on Cronos EVM,
Insurance Module: LCRO has an existing mechanism to provide insurance against the risk of a slashing penalty.
For details of zkCRO, visit the following pages:
Understanding ybETH, vETH, ybUSD and vUSD
The Cronos zkEVM blockchain aims to support yield generating tokens as first class citizens while at the same be fully interoperable with the larger ZK ecosystem. The design goals of vETH and vUSD are as follows:
Interoperability: The yield can be transferred together with the token across chains
Stability: The value of the yield earning token should stay close to the underlying token. The reason for this is that most users will struggle to trade vETH and vUSD if their value is not aligned with that of ETH and USD.
Interoperability
On the current Zksync shared bridge any token that is deployed on Ethereum and deposited into the bridge contract on Ethereum will have a corresponding token contract on the layer 2 chain. This token contract is deployed by the bridge itself and conforms to the ERC-20 standard. However, any additional custom logic is not included in the deployed default token contract on Layer 2. This has two implications:
Any actions on the original deployed contract that are outside of the ERC-20 specifications will not be synchronized to bridged tokens deployed on any other network.
The token value itself needs to include any earned yield
The tokens ybETH and ybUSD are designed to meet these requirements. They are standard ERC20 tokens, fully interoperable with the ZKsync shared bridge. Both tokens are yield-bearing, and their value changes over time relative to ETH and USD, in order to reflect the accumulated yield.
Stability
Most users wish to use yield generating tokens as if they were the same as the underlying. For example a yield generating stablecoin should always be pegged to 1 USD. However, a yield-bearing token cannot be both pegged to the underlying and interoperable, because custom token logic is not supported by the bridge.
This is why Veno Finance introduced two pairs of tokens: the interoperable "yb tokens" (ybETH, ybUSD) and the stable v tokens (vETH, vUSD). ybETH and ybUSD are interoperable tokens that can transfer both principal and yield across chains. vETH and vUSD are stable tokens that earn yield, backed by ybETH and ybUSD, visit ybETH & vETH and ybUSD & vUSD for details
For details of vETH and vUSD, visit the following pages:
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