Glossary of Terms

Medium-Risk/High-Risk – Refers to the security of the Vesper Grow Pool strategies. Medium-risk strategies have less steps and fewer asset conversions. Additionally, medium-risk strategies only interact with audited and highly secure third party contracts. Alternatively, high-risk strategies are more complex in terms of the underlying contract calls and may interact with unaudited protocols, such as Yearn vaults. (There is no 'low-risk' designation because we believe that labeling anything as low-risk in crypto is disingenuous.)

Conservative/Aggressive – Refers to how prone a Vesper Pool strategy is to realizing losses due to partial liquidation. Conservative pools adhere to higher collateralization ratios than aggressive pools, and as such are better protected in the event that the pool's deposit asset sees a rapid loss in value (thus putting the outstanding loan underwater and in danger of liquidation).

Black Swan Event – Extenuating circumstance where a drastic "flash crash" in the price of an asset causes financial products interfacing with the asset to breakdown. In the world of cryptocurrency, this looks like a substantial crash in Ethereum, BTC, or other collateral asset that leads to mass liquidations. The danger is compounded with low scalability making it difficult or impossible for debtors to service their loans in order to avoid liquidation.

Rebalance-Collateral – The process by which Vesper pools are adjusted to maintain health and compound yield back into the deposit asset. Rebalancing is carried out automatically by designated keepers. For lending and farming strategies, this typically involves harvesting rewards, swapping them into the deposit asset, and redeploying them. For borrow-based strategies, it can involve adjusting loan positions to keep collateral ratios within safe thresholds.

Developer's Fee – The 5% share of the fees taken by pools (as withdrawal fees and platform fees) that is allocated to the author of the strategy.

Treasury Box – Fees taken from Vesper products (pools or otherwise) are taken as tokenized shares. The treasury box converts these tokenized shares back to the underlying assets then swaps the assets for VSP on Uniswap, where 95% of it is given to stakers and 5% to strategy developers.

Reserves – 2,950,000 VSP of the 10,000,000 total supply is allocated to Vesper's DAO holdings. These reserves can be deployed only with the democratic approval of VSP holders. Reserves are designed to extend incentives to holding and liquidity pools beyond initial allocations and introduce incentives to new products as they are released.

Earning Rate – Earning Rate reflects the underlying yield accrued by pool assets as they are routed to other DeFi platforms per the pool strategy. The "spot" earning rate is calculated as last 24-hours performance annualized and compounded, while "average" reflects the past 30-days annualized and compounded.