Frequently Asked Questions about Convex Finance

Overview

Convex Finance is a DeFi protocol that maximizes rewards for liquidity providers and stakers. By pooling together resources, Convex Finance allows users to access boosted yields that would typically require locking large amounts of tokens individually.

The protocol integrates with Curve Finance, Frax, and f(x) Protocol, directing voting power to boost CRV, FXS, and FXN emissions for depositors. In return, Convex Finance earns a share of the platform fees which are distributed back to CVX token holders.

• Deposit LP tokens from Curve, Frax, or f(x) Protocol into Convex Finance
• Automatically earn boosted rewards without locking tokens yourself
• Claim your rewards at any time with no lock-up period on deposited LP tokens

Step-by-Step Guide

Getting started with Convex Finance is straightforward. Follow these steps to begin earning boosted rewards:

• Step 1: First, provide liquidity on Curve, Frax, or f(x) Protocol to receive LP tokens.
• Step 2: Connect your wallet to Convex Finance at convexfinance.com.
• Step 3: Navigate to the staking section for your preferred protocol (Curve, Frax, or f(x)).
• Step 4: Deposit your LP tokens into the corresponding Convex Finance pool.
• Step 5: Start earning boosted rewards automatically. Claim them whenever you like.

There is no minimum deposit requirement and no lock-up period for your LP tokens — you can withdraw at any time.

Supported Wallets

Convex Finance supports all major Ethereum-compatible wallets. You can connect using:

• MetaMask (browser extension or mobile)
• WalletConnect (compatible with dozens of mobile wallets)
• Coinbase Wallet
• Gnosis Safe (multi-sig)
• Brave Wallet
• Any injected web3 provider

Make sure your wallet is set to the Ethereum Mainnet when interacting with Convex Finance.

Reward Breakdown

When you deposit LP tokens into Convex Finance, you earn multiple layers of rewards simultaneously:

• Trading fees from the underlying Curve, Frax, or f(x) pool
• Boosted CRV, FXS, or FXN emissions — up to 2.5x the base rate through Convex Finance's pooled veCRV, veFXS, and veFXN holdings
• CVX tokens — earned proportionally to the CRV rewards you receive
• Additional incentives — some pools feature extra token incentives ("bribes") from protocols seeking liquidity

All rewards accumulate in real-time and can be claimed at any point without affecting your deposited principal.

CVX Token Utility

CVX is the native governance token of Convex Finance. It grants holders meaningful influence over the largest veCRV, veFXS, and veFXN positions in DeFi. Here is what you can do with CVX:

• Lock CVX (vlCVX): Lock your CVX for 16 weeks to earn a share of platform revenue, vote on gauge weight allocations, and receive bribes from protocols competing for liquidity incentives.
• Stake cvxCRV: Convert CRV to cvxCRV and stake it to earn CRV, CVX, and 3CRV trading fees.
• Governance voting: Participate in Convex Finance's own governance as well as vote on Curve, Frax, and f(x) governance proposals.

Locked CVX holders collectively control over 53% of total veCRV supply, making vlCVX one of the most powerful governance positions in DeFi.

Revenue Distribution

Convex Finance collects a performance fee from the CRV rewards earned by liquidity providers. This fee is then distributed across participants in the ecosystem:

• 10% to cvxCRV stakers as additional yield
• 5% to vlCVX holders as platform revenue share
• 1% to the caller who triggers reward harvesting (gas incentive)
• The remainder (84%) is returned to the LP depositor as boosted CRV rewards

This model ensures that all participants — liquidity providers, CRV stakers, and CVX lockers — benefit from the collective scale of Convex Finance's position in the ecosystem.

Security Architecture

Convex Finance places security at the forefront of its design. The key protections in place include:

• Immutable smart contracts: Core Convex Finance contracts cannot be upgraded or altered after deployment.
• Non-custodial design: Convex Finance never takes custody of your underlying assets. LP tokens remain claimable by depositors at all times.
• Multiple independent audits: The protocol has been audited by MixBytes, PeckShield, and Nomoi — three leading blockchain security firms.
• Community oversight: All major protocol changes require governance votes by vlCVX holders.

While no DeFi protocol is entirely risk-free, Convex Finance's architecture is specifically designed to minimize smart contract risk and eliminate admin key risks on core contracts. You can read all audit reports in the official documentation.

Governance Participation

Convex Finance operates a two-layer governance system. Decisions range from protocol upgrades to directing billions in liquidity incentives across DeFi:

• vlCVX voting: Lock CVX to receive vlCVX and vote every two weeks on how Convex Finance's veCRV, veFXS, and veFXN are allocated across gauge weights.
• Snapshot governance: Protocol-level decisions (fee parameters, new integrations) are voted on via Snapshot by vlCVX holders.
• Bribe marketplace: Protocols can incentivize vlCVX holders to direct emissions toward specific gauges, creating an efficient market for liquidity.

With over $520,000 in 14-day emissions under its control, Convex Finance's governance is among the most impactful in all of DeFi. Visit the governance portal to participate.

cvxCRV Explained

cvxCRV is Convex Finance's tokenized representation of veCRV. When you deposit CRV into Convex Finance, you receive cvxCRV at a 1:1 ratio. The conversion is one-directional — CRV is permanently locked in Convex Finance's veCRV position to maintain maximum boost.

Key differences between CRV and cvxCRV:

• CRV: Can be locked as veCRV for up to 4 years to earn protocol fees and vote on gauge weights.
• cvxCRV: Liquid token that can be staked on Convex Finance to earn CRV, CVX, and 3CRV rewards without locking. Tradeable on secondary markets (e.g. Curve's CRV/cvxCRV pool).

The cvxCRV staking vault on Convex Finance currently delivers a competitive variable APR sourced from Curve's fee distribution and CVX emissions.

Fee Structure

Convex Finance charges a 16% performance fee on CRV rewards earned by LP depositors. This fee does not affect the principal deposit — only a portion of the rewards are taken. Here is the breakdown:

• 16% of earned CRV is taken as a performance fee
• Of that 16%: 10% goes to cvxCRV stakers, 5% to vlCVX holders, 1% to the harvest caller
• No deposit fees, no withdrawal fees
• No lock-up period on LP deposits

Despite the 16% fee on rewards, Convex Finance users still typically receive significantly more net CRV than they would by depositing directly into Curve without a boost, because of the group's collective 2.5x boost applied across all pools.

Network Support

Convex Finance primarily operates on Ethereum Mainnet, where the core protocol contracts and CVX token live. The protocol integrates with:

• Curve Finance pools on Ethereum Mainnet
• Frax Finance on Ethereum Mainnet
• f(x) Protocol on Ethereum Mainnet

When connecting your wallet to use Convex Finance, ensure it is set to Ethereum Mainnet (chain ID 1). Transactions on Mainnet require ETH for gas fees. Always double-check the contract addresses in the official docs before interacting.

Community Channels

The Convex Finance community is active across several platforms. Whether you have technical questions, want to discuss governance, or just want to follow the latest updates, you can find us here:

• Discord: discord.gg/TTEVTqY488 — The main hub for support, discussion, and governance chat.
• Twitter: @ConvexFinance — Protocol announcements and updates.
• Medium Blog: convexfinance.medium.com — In-depth articles and protocol updates.
• GitHub: github.com/convex-eth — Open-source smart contract code.
• Documentation: docs.convexfinance.com — Full technical and user documentation.
• Email: [email protected]

The Convex Finance team does not offer direct financial advice. Always do your own research before participating in any DeFi protocol.

Responsible Disclosure

Security is a top priority for Convex Finance. If you believe you have discovered a bug or vulnerability in the protocol, please report it responsibly:

• Email the team at [email protected] with full details of the vulnerability.
• Do not publicly disclose the issue before the team has had a chance to investigate and remediate it.
• Provide as much detail as possible, including steps to reproduce, affected contracts, and potential impact.

Convex Finance appreciates the security research community's efforts to keep the protocol safe. The team reviews all reports promptly.