Updated Aqua Protocol: Season 3, RP Points, and New Borrowing Te…

Updated Aqua Protocol: Season 3, RP Points, and New Borrowing Terms

February 13th, 2025

What is Aqua Protocol?

Aqua Protocol is a key liquidity layer in the TON ecosystem, a lending protocol with fixed fees that issues its own stablecoin, AquaUSD. It is overcollateralized at 150% with liquid staking tokens, low-risk LP tokens, and RWA assets.

In the previous article, we explained in detail what Aqua Protocol is and why AquaUSD is needed on TON. Now, let's talk about the problems with the previous model, the updates, and how we are solving them.

Problems with the Previous Economic Model

Our protocol was officially launched on the mainnet on October 11, 2024. We launched immediately after three successful bug bounties in the testnet and two security audits.

Since the launch of Aqua Protocol, we have ranked at the top in the Open League among all DeFi projects on TON twice:

In October 2024, we took 2nd place in TVL growth, reaching $1.2 million in locked funds and minting $0.7 million AquaUSD.
In the New Year League, we took 1st place, peaking at $3.4 million in TVL and minting $1.8 million AquaUSD.

Thousands of users received great drops from Ton Foundation for participating in the Open League, and some profited from liquidations through our interface.

From August 2023 to August 2024, the first reward season for promoters and testnet users took place. The second season of rewards began in October 2024, during which we started distributing AquaXP to liquidity providers and AquaXP stakers. To date, the AquaXP distribution has amounted to around $130,000.

The goal of the AquaXP drop was to provide a flexible reward model for different categories of users. We understood that not all participants wanted to wait for the listing of the full token, so we allowed those who wanted to sell their AquaXP immediately or buy from others who were willing to wait. This created a model where everyone could choose the optimal way to interact with AquaXP.

This approach led to some problems and inefficiencies.

The first problem was that AquaXP was initially a non-utility on-chain point rather than a fully-fledged project token, with low liquidity and no market maker. This led to a price drop immediately after the distribution, which was expected, as AquaXP was simply a reward and not an asset with real value. It resembled vouchers like Notcoin and Storm Trade, but with a more convenient buying and selling model. We intentionally chose this format for the convenience of our users. However, the use of market orders and low liquidity led to sharp price fluctuations, which could have been avoided if AquaXP had been initially issued in an NFT.

The second problem: For most of our liquidity providers on DEXs in the AquaUSD/USDT pair, it is important to receive stable profits. However, the distribution of AquaXP, which has no utility, caused frustration. These users expected stable income, not points whose value could fluctuate. We understand this created confusion, and we are now working to address this imbalance.

To avoid misunderstanding, we have revised the third reward season and switched to a new model, using the successful experiences of other projects.

What’s New in Aqua Protocol in the New Season?

In the new season, Aqua Protocol introduces several significant changes that will impact AquaXP, minting and loan operations, and liquidity provision. Let's go through the key updates and the opportunities they bring.

1. AquaXP — What’s New?

AquaXP are points that will eventually be exchangeable for the AQUA token. The allocation for all 15 billion AquaXP will be 5% of the total AQUA token supply.

Sell AquaXP on xRocket using limit orders for a better price than market price.
Buy AquaXP on the market (here) to acquire future AQUA token allocation from those who choose to sell their points.
AquaXP can still be staked on jVault while waiting for further instructions on when and how to withdraw points.
Liquidity pools will no longer receive boosts using AquaXP. The current boost will be the last one. This is expected to stabilize the price of AquaXP.

2. Changes for Minting and Loan Users

We’ve updated the conditions for users minting AquaUSD and using loans. Here are the key changes:

No fees for MINT and REPAY: Minting and repaying operations are now fee-free for all collateral assets.
10% annual loan rate (borrow rate), applied every second to all collateral assets.
Lowered Collateralization Ratio (CR) for DEDUST LP tokens: This allows you to get more liquidity.

Updated CR and liquidation conditions:

LP Tokens Dedust (TON/USDT, tsTon/USDT, stTON/USDT):
- Mint CR: 160% (was 200%)
- Partial Liquidation: 130% (was 150%)
- Full Liquidation: 120% (was 125%)
LP Tokens stTON, tsTON, hTON, Storm TON-SLP:
- Mint CR: 200% (no change)
- Partial Liquidation: 150% (no change)
- Full Liquidation: 125% (no change)
LP Tokens Storm USDT-SLP:
- Mint CR: 120% (no change)
- Partial Liquidation: 110% (no change)
- Full Liquidation: 105% (no change)

Spot leverage (looping) is now simpler and more profitable, with the added benefit of not needing to pay the loan immediately.

More yield strategies will be published on our official Telegram channels.

You can swap AquaUSD for any token on TON at the best rates [here].

3. New Rewards for Borrowers

In the 3rd season, rewards will follow a new distribution logic, similar to Storm Trade.

As a reward for using credit in Aqua Protocol, users will earn RP points Aqua. These will be displayed in the Your Rewards section of the Aqua Protocol app.
RP points will be issued as cashback for the loan fee, and the distribution will happen weekly, retroactively, for each week.

Important: 1 RP point is not equal to 1 AquaXP.

4. Changes for Liquidity Providers

A portion of the income from the borrow rate will be directed toward boosting liquidity.

Boosts for liquidity providers in AquaUSD/USDT will now be provided exclusively in AquaUSD or USDT stablecoins.
This means that boosts will now be issued in dollars rather than volatile tokens.

Providing liquidity in the AquaUSD/USDT pair has become more profitable and conservative!

Learn more about providing liquidity in AquaUSD: guides and bonuses available here.

These changes make Aqua Protocol a more convenient and rewarding tool for working with loans and liquidity. We hope these new conditions will be beneficial and open up even more opportunities for you on our platform!

Conclusion

Aqua Protocol is becoming an even more attractive and profitable tool for working with liquidity and loans. The new conditions, such as the lowered CR, no fees for MINT and REPAY, and updated rewards for users, will provide you with more opportunities to earn profits and minimize risks.

Don't miss the chance to enhance your strategy with Aqua Protocol — in upcoming articles, we will explain in detail how to make the most of all the new updates.