🐻⛓️ Berachain Core Docs

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Reward Vaults ​

Reward Vaults are smart contracts in which users can stake their Proof-of-Liquidity (PoL) eligible assets to receive $BGT rewards. Reward Vaults are the only way anyone can earn $BGT rewards, and therefore serve the important function of gating entry into the PoL ecosystem.

Reward Vaults are key infrastructure that allows protocols to leverage PoL, enabling teams to incentivize users' actions in exchange for $BGT. A protocol can have multiple Reward Vaults, each with its own PoL-eligible asset to be staked. For example, BEX can have multiple pools earning $BGT, each with its own Reward Vault and respective PoL-eligible asset.

It should be noted that only Whitelisted Reward Vaults are elligible to receive $BGT emissions from Validators.

User Interactions ​

Staking With A Reward Vault ​

Berachain Reward Vault Staking BEX

To receive $BGT, a user must stake the PoL-eligible asset in its Reward Vault. The protocol that deployed the Reward Vault decides how users acquire the PoL-eligible asset to stake. The idea is that protocols would leverage this to attract liquidity or stimulate activity, and in return award users with the asset they can stake in their vault.

  1. The user takes some action that results in receiving a PoL-eligible asset, generally referred to as a receipt token.
  2. The user stakes the PoL-eligible asset in the corresponding vault.
  3. The user earns a portion of all the BGT emitted to that vault.

Earning BGT ​

The amount of $BGT rewards a user earns from a Reward Vault is a function of:

  1. The user's share of total assets staked in the Reward Vault
  2. The amount of $BGT rewards emitted to the Reward Vault

After staking assets in a Reward Vault, users are free to claim their earned rewards, add to their deposits, or withdraw their assets whenever they wish.

$BGT farming with Reward Vaults is meant to resemble familiar DeFi actions, providing a low barrier to entry.

$BGT Flow ​

When a validator is chosen to propose a block, they direct a portion of their $BGT emissions to specific Reward Vaults of their choice. To learn more about how $BGT is calculated in block production, check out the docs on emissions.

Incentives ​

To understand why validators would choose to emit $BGT to one Reward Vault over another, refer to Incentives in PoL, which discusses how protocols can influence validator behavior with economic incentives.

Vault Creation ​

New Reward Vaults can be created permissionlessly at https://hub.berachain.com/vaults/create.

Protocols creating Reward Vaults must additionally whitelist their vaults through $BGT governance to be eligible to receive emissions from validators.