Page cover image

🪣Liquidity Incentivization

Your vote is more than just emissions

Almost every protocol in DeFi needs to have a certain amount of liquidity for one reason or another.

However, current solutions for incentivizing liquidity come with their own tradeoffs and pitfalls:

  • Pool 2 emissions (i.e. attaching a reward to staked LPs) can be costly to maintain, and oftentimes results in a "farm and dump" resulting in low liquidity of farmed token.

  • Protocol owned liquidity can be costly to bootstrap, and liquidity may only be needed occasionally, instead of on-going basis.

  • Bribing voters in the CRV/CVX system can be costly as incumbents already have a sizeable lead. Additionally, the universe of pool types here are limited.

Last updated