Tutorial on using the Algofi Vault for Algorand Foundation Governance.
- Maintains an ALGO balance at least equal to their commitment amount
- Votes on all proposals
This is accomplished through the Algofi Vault -- a unique (1 per user) Algorand Account that the user has control over through the Algofi protocol. This vault account is the same account as the Storage Account for the Algofi lending protocol. The user operates their Algofi Vault via the protocol to supply ALGOs to the Vault, commit those ALGOs to Governance, vote via the Vault, and claim governance rewards from the Vault.
ALGOs supplied to the Algofi Vault are called "Vaulted Algos" or vALGOs. In the Algofi Lending Protocol they have the same price and collateral factor as ALGOs. The key difference between vALGOs and ALGOs is that you can participate in Algorand Governance with your vALGOs and borrow against them in the lending protocol, but no user can borrow your vALGOs. Likewise, you cannot borrow another user's vALGOs. Only ALGOs in the main ALGO market can be borrowed.
Let's walk through how to use the Algofi Vault to earn Governance Rewards and use Algofi: