Stakeholder Benefits/Incentives

The Exotic Vaults Protocol is built on a carefully designed ecosystem that ensures all stakeholders derive value from their participation. Each participant plays a vital role in the platform’s operations and growth, and they are rewarded through mechanisms that align with their contributions. Below is an overview of the benefits and incentives for each stakeholder group:

Governance Token Holders ($XVAULT)

Governance token holders are the backbone of the protocol, with their participation ensuring decentralised decision-making and long-term growth. Their benefits include:

• Governance Rights: Proportional voting power on critical decisions, such as fee structures, new features, and non‑financial governance mechanisms (e.g., time‑locked voting).

• Fee Reductions: Reduced trading fees based on the proportion of $XVAULT held.

• Exclusive Access: Priority participation in new asset offerings and token sales on the platform and on partner platforms (starting with Konvi)

Liquidity Providers (LPs)

Liquidity providers ensure the platform’s smooth operation by maintaining deep liquidity in Vaults. Their incentives include:

• Trading Fee Rewards: LPs earn a share of the trading fees in the form of Vault tokens generated in the Vaults they support.

• DAO‑approved LP rebates (time‑limited, from the community treasury; no return guarantees.

• Impermanent Loss Insurance: Optional insurance mechanisms funded through platform fees to mitigate potential losses from price volatility.

Future plans include yield opportunities: Enhanced returns through yield farming or staking programs tied to their liquidity contributions.

Asset Owners

Asset owners benefit from the ability to monetise their Real World Assets (RWAs) through the Exotic Vaults Protocol. Key incentives include:

• Access to Liquidity: Instant liquidity for traditionally illiquid assets, enabling asset owners to unlock value without long holding periods.

• Efficient Monetisation: Fractionalising assets into tradeable tokens creates additional revenue opportunities through trading and lending.

• Low Transaction Costs: Reduced fees compared to traditional markets for asset listing and trading.

• Price Discovery: Access to transparent and dynamic price discovery mechanisms that reflect real market demand.

Independent Auditors

Independent auditors play a critical role in maintaining the integrity and transparency of the protocol. Their incentives include:

• Audit Fees: Earn fees in the form of Vault Tokens for validating the authenticity and highlighting the risks of assets, tokens and custodians within Vaults.

• Reputation Building: A decentralised reputation system ensures that trusted auditors gain more visibility and opportunities within the ecosystem.

• Increased Rewards for Trusted Auditors: Verified auditors may receive higher fees and incentives for their contributions.

Physical Custodians

Physical custodians are responsible for securely storing the RWAs that back the tokens traded on the platform. Their benefits include:

• Custody Fees: Payment from asset owners for securely storing assets off the platform

• Entry Fees: Custodians will earn an initial fee whenever an asset owner deposits their assets in a Vault in the form of Vault Tokens

• Perpetual Earnings: Custodians will earn ongoing fees in the form of Vault Tokens from trading of assets they manage within the ecosystem

Secondary Traders

Traders on the platform benefit from instant and global access to unique, tokenised assets. Their incentives include:

• Ease of Access: Simplified trading processes with low barriers to entry, allowing participation from a diverse investor base.

• Market Opportunities: Access to a highly liquid market where they can buy and sell assets at dynamic, market-driven prices.

Transparency and Security: Blockchain-based trading ensures secure and verifiable transactions, fostering trust among participants.