Staking
Staking turns AERO into productive capital. When AERO holders stake their tokens, the protocol mints sAERO: an NFT (ERC-721) that grants Token Operator status and the ability to direct AERO Rewards through Predictive Allocation.
100% of Exchange Revenue (trading fees, MEV capture, Liquidity Payments, Launch Payments, and ancillary protocol revenue) flows to Token Operators based on the Allocation Power they direct to pools. Revenue accrues continuously as pools generate volume, and no share of it is diverted to other stakeholders.
What it is
sAERO represents a staked AERO commitment. Token holders (Operators) use sAERO stakes to direct new protocol emissions (AERO Rewards). Token Operators direct AERO Rewards toward liquidity pools they choose. Those AERO Rewards incentivize liquidity providers, and that liquidity makes pools more efficient for traders. The liquidity funded by their rewards sends fees back to those sAERO holders.
sAERO carries three key properties: a balance (the amount of AERO staked), an Allocation Power (the ability to direct rewards), and a date when the underlying AERO can be withdrawn.
How it works
AERO is staked for an amount and a duration from 6 months to 4 years. Alternatively, stakers can choose Perpetual Stake to maintain their stake at the 4-year maximum indefinitely. The sAERO balance and Allocation Power reflect the amount and the committed duration. Allocation Power is the power to direct AERO Rewards through Predictive Allocation, determining the holder's influence over protocol emissions.
A longer staking commitment maximizes Allocation Power upfront. Allocation Power decreases linearly over the staking period. At the end of the period, the underlying AERO becomes withdrawable and carries zero Allocation Power.
Example: staking 4 AERO for one year produces less Allocation Power than staking the same 4 AERO for four years. Duration and amount together determine the Allocation Power.
A Perpetual Stake deposit pins Allocation Power at maximum. This provides stable, long-term Allocation Power without managing deposit expiries. An sAERO holder can opt in to Perpetual Stake at any time. However, if the holder switches from Perpetual Stake and withdraws, they become subject to the staking wind-down period.
How it connects to the rest of Aero
sAERO sits at the center of Aero's economy. Almost every other product touches it.
- Token Operators direct AERO Rewards. Allocation Power is the input to Predictive Allocation. Token Operators use their Allocation Power to direct AERO Rewards to pools. Those rewards flow to liquidity providers in the allocated pools, incentivizing them to supply liquidity where Token Operators predict volume will be highest.
- sAERO earns from every Aero revenue stream. Exchange Revenue captured by protocol activity (trading fees, MEV capture, Liquidity Payments, Launch Payments, ancillary services) flows to Token Operators based on their Allocation Power. This means sAERO holders benefit directly from protocol growth: more trading volume produces more revenue, which flows to those directing capital toward productive pools.
Allocating to active pools
Token Operators may only direct AERO Rewards to pools with an Active Gauge. New pools are created with a gauge, but the gauge must be activated before the pool is eligible to receive AERO Rewards and become available for Token Operator allocation.
This ensures that Allocation Power directs rewards only to pools that have met Aero's listing and activation criteria.
What sAERO earns
Token Operators earn Exchange Revenue:
| Revenue stream | Source | When it arrives | How it works | Token Operator benefit |
|---|---|---|---|---|
| Trading Fees | Trading fees | Continuously as activity occurs | Trading fees generated from AERO-earning liquidity are distributed to Token Operators. A small % of fees generated by Fee-earning deposits may also be captured. | Pro rata share of trading fees generated. More volume in allocated pools equals more earnings. |
| MEV Capture | MEV on select L2s | Continuously as activity occurs | Trades paying a priority fee above a set threshold pay an extra swap fee, which flows to Token Operators like any other trading fee. | Additional rewards for Token Operators. |
| Liquidity Payments | Projects deposit tokens to encourage allocation | Continuously during project incentive period | Project-specific incentives flow to Token Operators who allocate to those pools. These are ongoing programs designed to highlight or sustain liquidity for specific tokens. | Additional revenue stream beyond trading fees. Rewards allocators for backing specific projects and pools. |
| Launch Payments | Projects deposit tokens at launch to bootstrap initial liquidity | Continuously during launch period | Launch Payments are Liquidity Payments funded specifically at token launch, offering concentrated incentives during the critical early phase when a token needs rapid liquidity establishment. | Rewards early allocators who back emerging tokens. Captures value from being first to allocate to newly launched pools. |
Exchange Revenue rewards accurate allocation. Liquidity Payments provide project-specific incentives. Together they create multiple paths for Token Operators to earn.
Stake configuration
An sAERO stake has these configuration options:
| Configuration | Options / description |
|---|---|
| Amount | AERO committed to the deposit. More AERO produces more Allocation Power, giving Token Operators more influence over AERO Rewards allocation. |
| Duration | From 6 months to 4 years, or Perpetual Stake for a permanent deposit. |
| Deposit type | Time-staked deposits are withdrawable at the end of duration. Perpetual Stake deposits maintain constant Allocation Power indefinitely. Token Operators can opt in to Perpetual Stake at any time. |
| Allocation method | Manual allocation through Markets gives direct control. Autopilot automates allocation and claims. |
| Deposit management | Add to a deposit (top-up the balance) or extend (delay the unstaking date) |
| Deposit format | sAERO is an ERC-721, making it transferable. |
| Withdraw | When a deposit reaches the end of duration, underlying AERO becomes withdrawable. |
Getting started
Open the Staking tab and choose "Stake AERO," then click "Create." Set the staking duration (from 6 months to 4 years, or select Perpetual Stake for a permanent deposit), enter the amount of AERO to stake, and review the projected Allocation Power based on amount and duration. Once confirmed, the sAERO NFT appears in the Dashboard with a countdown to the unstaking date. Allocation Power can be directed to pools immediately.
To direct Allocation Power toward specific pools and earn Exchange Revenue, see Staking and Allocating. For managed allocation, see Autopilot for Token Operators.