Stablecoin LPs on Chronos: New Arbitrum DEX Earning Up to 42% APR

Stablecoin LPs on Chronos

Before we get started, this is not a recommendation or endorsement to buy any token(s) mentioned. 

A new Arbitrum DEX called Chronos has attracted over $230 million TVL in its first 2 weeks since launching. Similar to Velodrome on Optimism, Chronos is a ve(3,3) exchange, using staking as a primary resource for accruing value to its token CHR. 

Liquidity providers (LPs) earn CHR tokens for participating in two different types of liquidity pools based on the tokens being provided:

  1. sAMM - for strongly correlated pairs, such as stablecoins
  2. vAMM - for uncorrelated pairs, such as CHR and ETH

Given some liquidity pools on Chronos are paying as much as 2,600% to LPs in the form of CHR tokens, there has been a frenzy to participate in what’s now:

  • The 2nd largest Solidly fork behind Velodrome
  • The 4th ranked DeFi protocol by TVL on Arbitrum
  • The 8th largest DEX in the broader crypto ecosystem

Like Velodrome, LPs earn emissions of CHR tokens proportional to the amount of liquidity they provide in pools. Staking LP tokens on the platform makes users eligible for CHR emissions, with base emission rates determined by Chronos gauges, controlled by veCHR voters.

By locking CHR for veCHR, users earn the right to vote on the platform's gauges. Gauges control the rate of emissions to different liquidity pools on the DEX. Pools that receive more votes earn a greater proportion of CHR incentives for that epoch. Each epoch lasts for 7 days, after which all bribes and trading fees are distributed as a lump sum to voters.

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