Incentives for liquidity providers.
Incentives for liquidity providers.
Uniswap makes it possible for liquidity providers to earn transaction fees from the fund pool when they actively provide liquidity. Once they withdraw funds from the pool, they will no longer receive that passive income.
Besides, as agreements become more and more popular, even though they are early liquidity providers, they still face being joined by large funds, exchanges, mining pools, and other (larger and richer) stakeholders to join the agreement, which will the risk of earnings dilution.
In FarSwap, liquidity is provided to the fund pool, and FAR tokens can also be rewarded. However, unlike Uniswap, even if you decide to no longer provide liquidity, the FAR tokens you get will also entitle you to continue to receive a portion of the fees in the FAR agreement.
As an early miner involved in providing liquidity, you will become an important stakeholder in the agreement. The income you receive from your investment in the mining in the LP ( provides flow mobility) the number of tokens proportional to the total number of coins on behalf of the LP. Unless you continue to increase the provision of liquidity, your holdings and corresponding reward income will gradually be diluted as the capital pool grows.
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