What is vETH?

vETH is a ERC20 token which aims to follow the value of ETH, while enabling its holders to accumulate rewards generated by proof-of-stake on the Ethereum mainnet.

vETH is powered by Veno Finance.

To collect rewards, vETH token holders must claim rewards on a dedicated decentralized application which will be published after Cronos zkEVM mainnet launch. The value of the rewards depends on the rewards generated by ETH staking, and may be impacted by slashing events.

When vETH is locked into DeFi protocols on Cronos zkEVM, the rewards accrue to these protocols so it is the responsibility of these protocols to decide and communicate how these rewards are distributed between users and other protocol stakeholders.

How does it work?

When users deposit ETH on the Cronos zkEVM native bridge, they will receive vETH (Veno Ethereum) which is an asset that aims to approximate the value of 1 ETH. vETH holders will be able to earn yield.

vETH will not appreciate relative to ETH to reflect the accumulated yield, as this would offer a confusing user experience. Rather, vETH holders will be able to claim the accumulated yield from a "Reward Vault" that will be updated every week to account for their new holdings.

Under the hood, vETH is backed by ybETH, which is a yield-bearing token that appreciates relative to ETH over time.

vETH is created by the decentralized Veno Finance protocol, in partnership with Cronos zkEVM.

How is the yield generated?

The ETH collected by the Cronos zkEVM native bridge will be staked by the Veno Finance protocol into a reputable self-custodial ETH staking platform on Ethereum.

Veno Finance currently uses Kiln’s staking pool on Ethereum for the existing LETH token on zkSync Era. vETH is different from LETH, but the staking mechanics are similar.

How can users convert vETH back into ETH?

When users send their vETH to the Cronos zkEVM native bridge on Cronos zkEVM, the vETH is bridged to Ethereum mainnet, and it is used to unlock the underlying amount of ETH from staking pool, potentially minus any slashing penalty that may have been incurred by the staking pool.

This process can take around 1 week (see here on how this works for LETH).

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