aave · AGMASO · Aug 19, 2026
diff --git a/src/components/incentives/IncentivesButton.tsx b/src/components/incentives/IncentivesButton.tsx
@@ -355,8 +355,13 @@ const Content = ({
   const hasPointsBreakdown = incentives.some(
     (incentive) => (incentive as ExtendedReserveIncentiveResponse)?.breakdown?.points !== undefined
   );
+  // A reserve whose only Merkl campaign is balance-based has a zero unconditional APY, but
+  // the badge still has to be there for the user to reach the tooltip.
+  const hasBalanceCampaign = incentives.some(
+    (incentive) => (incentive as ExtendedReserveIncentiveResponse)?.hasBalanceCampaign
+  );
 
-  if (incentivesNetAPR === 0 && !hasPointsBreakdown) {
+  if (incentivesNetAPR === 0 && !hasPointsBreakdown && !hasBalanceCampaign) {
     return displayBlank ? <BlankIncentives /> : null;
   }
 

diff --git a/src/components/incentives/IncentivesCard.tsx b/src/components/incentives/IncentivesCard.tsx
@@ -97,6 +97,11 @@ export const IncentivesCard = ({
     ? merklPointsIncentives.breakdown.merklIncentivesAPR || 0
     : merklIncentives?.breakdown?.merklIncentivesAPR || 0;
 
+  // Balance-based Merkl campaigns are excluded from `merklIncentivesAPR` by the hook: only
+  // positions above a minimum size earn them. Flag the value with an asterisk so the user
+  // knows there is extra APY to be found in the tooltip.
+  const hasBalanceCampaign = Boolean(merklIncentives?.hasBalanceCampaign);
+
   const isBorrow = protocolAction === ProtocolAction.borrow;
 
   // If any incentive is infinite, the total should be infinite
@@ -170,15 +175,22 @@ export const IncentivesCard = ({
               ∞ %
             </Typography>
           ) : (
-            <FormattedNumber
-              data-cy={`apy`}
-              value={displayAPY}
-              percent
-              variant={variant}
-              symbolsVariant={symbolsVariant}
-              color={color}
-              symbolsColor={color}
-            />
+            <Box sx={{ display: 'inline-flex', alignItems: 'flex-start' }}>
+              <FormattedNumber
+                data-cy={`apy`}
+                value={displayAPY}
+                percent
+                variant={variant}
+                symbolsVariant={symbolsVariant}
+                color={color}
+                symbolsColor={color}
+              />
+              {hasBalanceCampaign && (
+                <Typography component="span" variant={variant} color={color || 'text.secondary'}>
+                  *
+                </Typography>
+              )}
+            </Box>
           )}
           {tooltip}
           {inlineIncentives && (

diff --git a/src/components/incentives/MerklIncentivesTooltipContent.tsx b/src/components/incentives/MerklIncentivesTooltipContent.tsx
@@ -1,5 +1,5 @@
 import { Trans } from '@lingui/macro';
-import { Box, Typography, useTheme } from '@mui/material';
+import { Box, Tooltip, Typography, useTheme } from '@mui/material';
 import { ExtendedReserveIncentiveResponse } from 'src/hooks/useMerklIncentives';
 
 import { PointsBasedCampaignTooltip } from '../infoTooltips/PointsBasedCampaignTooltip';
@@ -21,6 +21,15 @@ export const MerklIncentivesTooltipContent = ({
   const merklIncentivesFormatted = getSymbolMap(merklIncentives);
 
   const isPointsBased = Boolean(merklIncentives?.breakdown?.points);
+  const balanceCampaignAPY = merklIncentives.breakdown.balanceCampaignAPY || 0;
+  // A reserve can be covered by a balance campaign alone, so the per-campaign rows must
+  // also be used when there is a single reward: the aggregated row cannot express that
+  // part of the APY is gated behind a minimum position size.
+  const hasBalanceCampaign = Boolean(merklIncentives.hasBalanceCampaign);
+  const perCampaignRewards = merklIncentives.rewardsTokensMappedApys ?? [];
+  const showPerCampaignRows =
+    perCampaignRewards.length > 1 || (hasBalanceCampaign && perCampaignRewards.length > 0);
+  const balanceCampaignMessage = merklIncentives.balanceCampaignMessage;
   return (
     <Box
       sx={{
@@ -226,9 +235,8 @@ export const MerklIncentivesTooltipContent = ({
                   </Typography>
                 </Box>
               </Row>
-            ) : merklIncentives.rewardsTokensMappedApys &&
-              merklIncentives.rewardsTokensMappedApys.length > 1 ? (
-              merklIncentives.rewardsTokensMappedApys.map((reward, index) => {
+            ) : showPerCampaignRows ? (
+              perCampaignRewards.map((reward, index) => {
                 const { tokenIconSymbol, symbol, aToken } = getSymbolMap({
                   rewardTokenSymbol: reward.token.symbol,
                   rewardTokenAddress: reward.token.address,
@@ -255,6 +263,24 @@ export const MerklIncentivesTooltipContent = ({
                         <Typography variant={typographyVariant} sx={{ ml: 0.5 }}>
                           {merklIncentives.breakdown.isBorrow ? '(-)' : '(+)'}
                         </Typography>
+                        {reward.isBalanceCampaign && (
+                          <Tooltip
+                            title={
+                              balanceCampaignMessage ||
+                              'This reward is only earned by positions above a minimum size.'
+                            }
+                            arrow
+                            placement="top"
+                          >
+                            <Typography
+                              variant={typographyVariant}
+                              color="warning.main"
+                              sx={{ ml: 0.75, cursor: 'help', textDecoration: 'underline dotted' }}
+                            >
+                              <Trans>conditional</Trans>
+                            </Typography>
+                          </Tooltip>
+                        )}
                       </Box>
                     }
                     width="100%"
@@ -338,6 +364,47 @@ export const MerklIncentivesTooltipContent = ({
                   </Typography>
                 </Box>
               </Row>
+
+              {hasBalanceCampaign && balanceCampaignAPY > 0 && (
+                <>
+                  <Row
+                    height={32}
+                    caption={
+                      <Typography variant={typographyVariant} fontWeight={600}>
+                        <Trans>With balance bonus</Trans>
+                      </Typography>
+                    }
+                    width="100%"
+                  >
+                    <Box sx={{ display: 'inline-flex', alignItems: 'center' }}>
+                      <FormattedNumber
+                        value={
+                          merklIncentives.breakdown.isBorrow
+                            ? merklIncentives.breakdown.totalAPY - balanceCampaignAPY
+                            : merklIncentives.breakdown.totalAPY + balanceCampaignAPY
+                        }
+                        percent
+                        variant={typographyVariant}
+                        color="text.primary"
+                      />
+                      <Typography variant={typographyVariant} sx={{ ml: 1 }} color="text.primary">
+                        <Trans>APY</Trans>
+                      </Typography>
+                    </Box>
+                  </Row>
+
+                  <Typography variant="caption" color="text.secondary" sx={{ mt: 1 }}>
+                    {balanceCampaignMessage ? (
+                      <Trans>{balanceCampaignMessage}</Trans>
+                    ) : (
+                      <Trans>
+                        Part of these rewards is only earned by positions above a minimum size, so
+                        the total APY shown in the markets and dashboard tables excludes it.
+                      </Trans>
+                    )}
+                  </Typography>
+                </>
+              )}
             </Box>
           </>
         ) : (

diff --git a/src/hooks/useMerklIncentives.ts b/src/hooks/useMerklIncentives.ts
@@ -90,6 +90,7 @@ type ReserveIncentiveAdditionalData = {
   customClaimMessage?: string;
   customMessage?: string;
   customForumLink?: string;
+  balanceCampaignMessage?: string;
 };
 
 export type ExtendedReserveIncentiveResponse = ReserveIncentiveResponse &
@@ -120,14 +121,22 @@ export type ExtendedReserveIncentiveResponse = ReserveIncentiveResponse &
       campaignId: string;
       dailyRewardsRecordId: string;
       onChainCampaignId: string;
+      apr: number;
       apy: number;
+      isBalanceCampaign: boolean;
     }[];
+    hasBalanceCampaign?: boolean;
+    balanceCampaignAPY?: number;
   };
 
 export type MerklIncentivesBreakdown = {
   protocolAPY: number;
   protocolIncentivesAPR: number;
   merklIncentivesAPR: number; // Now represents APY (converted from APR)
+  // Extra APY from balance-based campaigns. Deliberately excluded from
+  // `merklIncentivesAPR` and `totalAPY`: only positions above the campaign's minimum
+  // size earn it, so it must not inflate the headline APY.
+  balanceCampaignAPY: number;
   totalAPY: number;
   isBorrow: boolean;
   breakdown: {
@@ -240,9 +249,19 @@ export const useMerklIncentives = ({
         return null;
       }
 
+      const balanceCampaignTokensSet = new Set(
+        (EXTRA_WHITELIST_TOKENS.balanceCampaignRewardTokens ?? [])
+          .filter(Boolean)
+          .map((token) => token.toLowerCase())
+      );
+
+      // Balance campaign payout tokens are whitelisted implicitly: listing them once in
+      // `balanceCampaignRewardTokens` is enough. Keeping them out of the whitelist would
+      // count their APR in the total with no row to explain it.
       const whitelistedTokensSet = new Set(
         [
           ...EXTRA_WHITELIST_TOKENS.whitelistedRewardTokens.map((token) => token.toLowerCase()),
+          ...balanceCampaignTokensSet,
         ].filter(Boolean)
       );
 
@@ -273,7 +292,6 @@ export const useMerklIncentives = ({
         return sum + oppApr;
       }, 0);
 
-      const merklIncentivesAPY = convertAprToApy(totalMerklAPR);
       const aprsBreakdowns = whitelistedOpportunities.flatMap((opp) => opp.aprRecord.breakdowns);
       const breakdownTokens = whitelistedOpportunities.flatMap((opp) => {
         return opp.rewardsRecord.breakdowns;
@@ -286,22 +304,43 @@ export const useMerklIncentives = ({
             return isWhitelisted && reward.onChainCampaignId === aprBreakdown.identifier;
           });
           if (matchingReward) {
+            const apr = getCampaignIncentiveApr({
+              targetAprPercent: aprBreakdown.value,
+              distributionType: aprBreakdown.distributionType,
+              protocolAction,
+              baseProtocolApy: protocolAPY,
+            });
+
             return {
               ...matchingReward,
-              apy: convertAprToApy(
-                getCampaignIncentiveApr({
-                  targetAprPercent: aprBreakdown.value,
-                  distributionType: aprBreakdown.distributionType,
-                  protocolAction,
-                  baseProtocolApy: protocolAPY,
-                })
+              apr,
+              apy: convertAprToApy(apr),
+              isBalanceCampaign: balanceCampaignTokensSet.has(
+                matchingReward.token.address.toLowerCase()
               ),
             };
           }
           return null;
         })
         .filter((item): item is NonNullable<typeof item> => item !== null);
 
+      // Balance-based campaigns pay out through a dedicated wrapper token, so their
+      // tranche is carved out of the total and surfaced separately: the headline APY must
+      // only include what every position earns.
+      const balanceCampaignRewards = rewardsTokensMappedApys.filter(
+        (reward) => reward.isBalanceCampaign
+      );
+      const balanceCampaignAPR = balanceCampaignRewards.reduce(
+        (sum, reward) => sum + reward.apr,
+        0
+      );
+      const balanceCampaignAPY = balanceCampaignRewards.reduce(
+        (sum, reward) => sum + reward.apy,
+        0
+      );
+      const hasBalanceCampaign = balanceCampaignRewards.length > 0;
+      const merklIncentivesAPY = convertAprToApy(Math.max(totalMerklAPR - balanceCampaignAPR, 0));
+
       const primaryOpportunity = whitelistedOpportunities[0];
       const isSelf = whitelistedOpportunities.some(isSelfOpportunity);
       const rewardToken = primaryOpportunity.rewardsRecord.breakdowns[0].token;
@@ -329,10 +368,13 @@ export const useMerklIncentives = ({
         ...incentiveAdditionalData,
         isSelf,
         rewardsTokensMappedApys,
+        hasBalanceCampaign,
+        balanceCampaignAPY,
         breakdown: {
           protocolAPY,
           protocolIncentivesAPR: protocolIncentivesAPY,
           merklIncentivesAPR: merklIncentivesAPY,
+          balanceCampaignAPY,
           totalAPY,
           isBorrow,
           breakdown: {

diff --git a/src/hooks/useMerklPointsIncentives.ts b/src/hooks/useMerklPointsIncentives.ts
@@ -151,6 +151,7 @@ export const useMerklPointsIncentives = ({
         protocolAPY,
         protocolIncentivesAPR: protocolIncentivesAPY,
         merklIncentivesAPR: merklIncentivesAPY,
+        balanceCampaignAPY: 0,
         totalAPY,
         isBorrow,
         breakdown: {

diff --git a/src/locales/el/messages.js b/src/locales/el/messages.js
diff --git a/src/locales/en/messages.js b/src/locales/en/messages.js
diff --git a/src/locales/en/messages.po b/src/locales/en/messages.po
@@ -1357,6 +1357,10 @@ msgstr "You have assets with zero LTV that are blocking this operation. Please w
 msgid "{0}"
 msgstr "{0}"
 
+#: src/components/incentives/MerklIncentivesTooltipContent.tsx
+msgid "Part of these rewards is only earned by positions above a minimum size, so the total APY shown in the markets and dashboard tables excludes it."
+msgstr "Part of these rewards is only earned by positions above a minimum size, so the total APY shown in the markets and dashboard tables excludes it."
+
 #: src/components/transactions/Swap/warnings/postInputs/ZeroLTVDestinationWarning.tsx
 msgid "{0} has a Loan-to-Value of 0, so it will not be enabled as collateral automatically after the swap."
 msgstr "{0} has a Loan-to-Value of 0, so it will not be enabled as collateral automatically after the swap."
@@ -1708,6 +1712,10 @@ msgstr "{m}m"
 msgid "Inquiry"
 msgstr "Inquiry"
 
+#: src/components/incentives/MerklIncentivesTooltipContent.tsx
+msgid "With balance bonus"
+msgstr "With balance bonus"
+
 #: src/ui-config/errorMapping.tsx
 msgid "Unbacked mint cap is exceeded"
 msgstr "Unbacked mint cap is exceeded"
@@ -2630,6 +2638,10 @@ msgstr "Withdraw sGHO"
 msgid "Asset"
 msgstr "Asset"
 
+#: src/components/incentives/MerklIncentivesTooltipContent.tsx
+msgid "conditional"
+msgstr "conditional"
+
 #: src/modules/governance/proposal/ProposalOverview.tsx
 msgid "Share on twitter"
 msgstr "Share on twitter"
@@ -3639,6 +3651,10 @@ msgstr "Available to supply"
 msgid "Claiming all protocol rewards and merit rewards together"
 msgstr "Claiming all protocol rewards and merit rewards together"
 
+#: src/components/incentives/MerklIncentivesTooltipContent.tsx
+msgid "{balanceCampaignMessage}"
+msgstr "{balanceCampaignMessage}"
+
 #: src/modules/governance/proposal/ProposalTimeline.tsx
 msgid "Voting activated"
 msgstr "Voting activated"
@@ -3835,6 +3851,7 @@ msgstr "Selected supply assets"
 #: src/components/incentives/MerklIncentivesTooltipContent.tsx
 #: src/components/incentives/MerklIncentivesTooltipContent.tsx
 #: src/components/incentives/MerklIncentivesTooltipContent.tsx
+#: src/components/incentives/MerklIncentivesTooltipContent.tsx
 #: src/modules/dashboard/lists/BorrowedPositionsList/BorrowedPositionsList.tsx
 #: src/modules/dashboard/lists/BorrowedPositionsList/BorrowedPositionsList.tsx
 #: src/modules/dashboard/lists/BorrowedPositionsList/BorrowedPositionsListItem.tsx

diff --git a/src/locales/es/messages.js b/src/locales/es/messages.js
diff --git a/src/locales/fr/messages.js b/src/locales/fr/messages.js
diff --git a/src/ui-config/merklConfig.ts b/src/ui-config/merklConfig.ts
@@ -2,10 +2,15 @@ type AdditionalIncentiveInfo = {
   customMessage?: string;
   customClaimMessage?: string;
   customForumLink?: string;
+  // Copy explaining the minimum position size required to earn the extra bps of a
+  // balance-based Merkl campaign. Written manually per reserve, since the threshold
+  // is not exposed by the Merkl API.
+  balanceCampaignMessage?: string;
 };
 
 type MerklWhitelistConfig = {
   whitelistedRewardTokens: string[];
+  balanceCampaignRewardTokens: string[];
   additionalIncentiveInfo: Record<string, AdditionalIncentiveInfo>;
 };
 
@@ -561,6 +566,18 @@ export const EXTRA_WHITELIST_TOKENS: MerklWhitelistConfig = {
     '0x58a6d21fd258166FF058bb4488a77B7308DDd514',
     '0x09E4C43B7Ce78AC58fF6A920f1fD5D84a7975f78',
   ],
+  // Wrapper reward tokens deployed exclusively as the payout of balance-based Merkl
+  // campaigns (extra bps on top of the regular campaign, gated by a minimum position
+  // size). Their presence in a campaign's rewards is what flags the reserve as having
+  // a balance campaign.
+  //
+  // These are whitelisted implicitly, so an address goes in here *instead of* in
+  // `whitelistedRewardTokens` above, never in both. When adding one:
+  //   1. add an entry to `IncentivesSymbolMap` in IncentivesTooltipContent.tsx so the
+  //      row renders the economic token's icon instead of the wrapper symbol;
+  //   2. add `balanceCampaignMessage` in `additionalIncentiveInfo` for every reserve
+  //      the campaign targets, with the actual threshold.
+  balanceCampaignRewardTokens: [],
   additionalIncentiveInfo: {
     '1-0x4F5923Fc5FD4a93352581b38B7cD26943012DECF': {
       customMessage: