Row 4958

Row ID: 4958 | Dataset Entry | Axioma AXP Content Repository

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There are many incentive-based protocols out there. Most of which, incentivize Liquidity providers to provide liquidity on a specific pool. However, by its nature, liquidity providing is a passive activity. Liquidity providers as users are lazy, unlike traders. Everyone is crypto is a trader, but only a small subset of us are liquidity providers. Why isn't there a protocol to incentivize people to trade and earn rewards the more they swap (buy or sell)

Trading leads to LP fees, once LP fees are higher, Liquidity providers would want to capture this new volume, so they increase liquidity which leads to less slippage, which leads to more volume and the cycle continues.

This means, that focusing on volume "demand" instead of liquidity "supply" could lead to much better results for any pool.

Thoughts?

FieldValue
text There are many incentive-based protocols out there. Most of which, incentivize Liquidity providers to provide liquidity on a specific pool. However, by its nature, liquidity providing is a passive activity. Liquidity providers as users are lazy, unlike traders. Everyone is crypto is a trader, but only a small subset of us are liquidity providers. Why isn't there a protocol to incentivize people to trade and earn rewards the more they swap (buy or sell) Trading leads to LP fees, once L…
label r/ethereum
dataType post
communityName r/ethereum
datetime 2024-04-24
username_encoded Z0FBQUFBQm5LakwycWxMYzhaQ1lCOGVjZzVoa2FOMXdid3RNNXBGMEtOQTgwSXNVb29Oa1ZkalVEUzNYeW04NFF3MUVOc19iUUpINUxiNjR5X2YtRDFFWU40UVd4bjM3MWc9PQ==
url_encoded Z0FBQUFBQm5Lak9GMHNvekE5eHBCT2NkMFo5Z0JNTWt3WWw5V1FNcHVJaS1KWEh2VzhKOTQ0bDNkOG9CaDF1VlpXWWpKS29YOFNiMDFYZjh0OGFnb0hndm03bDlVem1yaWV4LVdBRmtQNUhMZF9mXzZqcHBVQkIxbzdPYkpaYk9sNWY3dXpUczhsdjJXOTRwVVNmdGpEcmc0aGpNd0Nmb3NlMkRRUkZ1Wk10WXlISHlwOGk4TksyYmJzZ21XRnJOSE8zTU5FRWF1akdK

Raw Record

{
  "text": "There are many incentive-based protocols out there. Most of which, incentivize Liquidity providers to provide liquidity on a specific pool. However, by its nature, liquidity providing is a passive activity. Liquidity providers as users are lazy, unlike traders.   \nEveryone is crypto is a trader, but only a small subset of us are liquidity providers.   \nWhy isn't there a protocol to incentivize people to trade and earn rewards the more they swap (buy or sell)   \n\n\nTrading leads to LP fees, once LP fees are higher, Liquidity providers would want to capture this new volume, so they increase liquidity which leads to less slippage, which leads to more volume and the cycle continues.   \n\n\nThis means, that focusing on volume \"demand\" instead of liquidity \"supply\" could lead to much better results for any pool.   \n\n\nThoughts? ",
  "label": "r/ethereum",
  "dataType": "post",
  "communityName": "r/ethereum",
  "datetime": "2024-04-24",
  "username_encoded": "Z0FBQUFBQm5LakwycWxMYzhaQ1lCOGVjZzVoa2FOMXdid3RNNXBGMEtOQTgwSXNVb29Oa1ZkalVEUzNYeW04NFF3MUVOc19iUUpINUxiNjR5X2YtRDFFWU40UVd4bjM3MWc9PQ==",
  "url_encoded": "Z0FBQUFBQm5Lak9GMHNvekE5eHBCT2NkMFo5Z0JNTWt3WWw5V1FNcHVJaS1KWEh2VzhKOTQ0bDNkOG9CaDF1VlpXWWpKS29YOFNiMDFYZjh0OGFnb0hndm03bDlVem1yaWV4LVdBRmtQNUhMZF9mXzZqcHBVQkIxbzdPYkpaYk9sNWY3dXpUczhsdjJXOTRwVVNmdGpEcmc0aGpNd0Nmb3NlMkRRUkZ1Wk10WXlISHlwOGk4TksyYmJzZ21XRnJOSE8zTU5FRWF1akdK"
}
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