VIP Introduction

In an ecosystem with a growing number of rollups, aligning the incentives of all participants is crucial. Although there have been attempts to achieve this, most encounter a few common core problems:

• Misalignment of incentives for dApps that generate high levels of on-chain activity and value
• Economic underutilization of the native token
• Inefficient distribution of protocol-level grants and incentives to foster long-term value and alignment

Initia aims to address these issues for Interwoven Rollups through a novel incentive alignment mechanism known as the Vested Interest Program (VIP). The VIP achieves this by programmatically rewarding valuable economic activities:

• Rollups receive reward allocations for creating innovative apps and new use cases for the INIT token
• Users earn INIT tokens from performing beneficial actions or meeting criteria set by the L2s.

Finally, the VIP allocates a portion of overall rewards directly to the rollups. This ensures that rollup teams, rollup users, and INIT holders are long-term aligned with the success of the ecosystem.