> ## Documentation Index
> Fetch the complete documentation index at: https://docs.batt.farm/llms.txt
> Use this file to discover all available pages before exploring further.

# Ecosystem-Routed Incentives

> Rewards for participants in markets that use KRW*.

[한국어로 읽기](https://docs.batt.farm/ecosystem-routed-incentives.md)

Through Ecosystem-Routed Incentives (ERI), batt uses a portion of borrowing interest and fees to reward participants in markets that use KRW\*.

These markets need counterparties and liquidity so users can swap borrowed KRW\*, deposit tokens they hold, or buy KRW\* to repay a loan.

## Lending market incentives

In an external lending market that supports KRW\*, users can supply KRW\* or borrow it from the market. Borrowing there is different from depositing collateral into batt to mint new KRW\*.

| Recipient | Interest paid or received in the market | What ERI adds |
| - | - | - |
| KRW\* supplier | Receives interest paid by borrowers | Additional rewards for supplying funds |
| KRW\* borrower | Pays borrowing interest to the market | Rewards that help offset borrowing costs |

A reward paid to a borrower does not change their loan's interest rate. When ERI support ends, the borrower still owes interest under the loan's terms.

## DEX incentives

batt can reward liquidity providers in KRW\* pools directly. Where a DEX supports [gauge voting](https://docs.batt.farm/en/glossary.md#gauges-and-voting-incentives), batt can also offer incentives to voters who direct rewards toward a KRW\* pool.

ERI aims to help pools handle the amounts users want to trade. Creating more pools alone does not provide that liquidity. LPs in a KRW\*/USDC pool must also account for exchange-rate changes between the two currencies.

## Who receives rewards?

The core team will initially select recipients and allocations. batt plans to move these decisions to ve governance after a token launch. ve governance is not currently active.

For each supported market, the batt team will specify:

* The market and reward recipients.
* The reward asset and funding source.
* The support period and allocation conditions.

Integrating KRW\* does not automatically qualify a market for ERI. The SP also receives a share of borrowing interest and fees, so batt cannot use all of that income for external incentives.

> [card] [Rewards and market funding](https://docs.batt.farm/en/ecosystem-routed-liquidity.md)
>
> ERI pays rewards to participants. Through ERL, batt plans to supply markets with funds it manages.


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