Emissions
Emissions are the protocol's issuance of new AERO. That AERO is distributed as AERO Rewards: the reward stream that draws liquidity to the pools where trading happens.
New AERO streams continuously, in response to Predictive Allocation and gauge caps.
Schedule and rate
The AER Engine caps each pool's AERO Rewards as a multiple of its projected revenue, updated dynamically as conditions change (see Gauge Caps below). Because the cap tracks revenue instead of a flat schedule, realized inflation moves with real activity rather than accruing on a set curve.
At launch, inflation is capped at 20% annualized as a hard ceiling, but realized inflation can be substantially lower due to several programs designed to optimize issuance.
Tokens only mint when rewards are actually claimed by liquidity providers, not upfront in a lump sum. Gauges intelligently track rewards owed to LPs, and AERO is minted to settle those claims when redeemed. This prevents unclaimed rewards from inflating circulating supply before they're collected.
Emissions overview
Where emissions go
Issued AERO follows allocation to pools, and within a pool it reaches liquidity providers as AERO Rewards on their AERO-earning deposits. An LP who earns AERO can hold it, sell it, redeposit it as liquidity, or stake it into sAERO to become a Token Operator themselves. See AERO and sAERO.
How it works
AERO Rewards. Stream continuously, directed by Token Operator allocation to pools. The AER Engine (Adaptive Emissions Rate) governs the pace using two complementary controls: where rewards go (allocation) and how much value each pool receives (gauge caps).
Three key properties:
- Continuous. AERO Rewards stream per second, not on a fixed schedule or fixed token quantity.
- Fee-responsive. The overall issuance rate responds to observed protocol activity rather than running on a fixed formula. The AER Engine caps rewards by value, not token count: each pool's cap is set as a multiple of its projected revenue, and only the tokens needed to fill that value are minted. Realized inflation adjusts based on real activity instead of accruing automatically.
- Directed by allocation. Issued AERO flows to pools according to how Token Operators allocate their Staking Weight, continuously steering rewards toward pools actually earning fees. See Predictive Allocation.
Gauge Caps. Set a custom reward cap for every pool tied to its projected revenue: its swap fees, MEV capture, and Liquidity Payments combined.
Gauge caps are updated dynamically so reward value stays competitive with market conditions while preventing overpayment. Any rewards a pool would receive above its cap are tracked as unissued emissions and never minted.
How they work together: Allocation sets the direction and distribution of rewards to the most productive pools; Gauge Caps set the magnitude of value delivered to each pool. Together, these controls calibrate rewards to where they create the most value, rather than spread evenly regardless of effectiveness.
Contributor allocation
A share of issuance funds ongoing protocol development and ecosystem programs at a rate of 5% of emissions. For every 100 AERO a liquidity provider claims, 5 additional AERO are minted to the Aero Foundation, where the tokens are staked as a Perpetual Stake. The revenue generated by the staked AERO can be used to support Momentum Fund programs for contributors, development, grants, and partnership programs. The Aero Foundation retains custody of the issued tokens. Issuance is fixed at the contract level and capped: it cannot be raised above 5%.
Supply history
Aero's supply was not created at launch. It migrated in from two predecessor protocols, and both of those had their own genesis distributions years earlier. The distribution history of Velodrome and Aerodrome provides a more complete history of distribution at the inception of Aero.
Aerodrome
Final Token Supply: 2.0026B
Initial Token Supply: 500M AERO (450M of which was issued as vote-locked veAERO)
Velodrome
Final Token Supply: 2.6485B
Initial Token Supply: 400M VELO