Liquidity Minting
As mentioned, liquidity providers (LPs) on Liquid’s AMM earn a portion of trading fees in $LIFI. This system distributes $LIFI to those who help make the marketplace liquid, rewarding users who contribute to a healthier trading environment.
It creates a positive feedback loop:
More trading →
More $LIFI earned by LPs →
More LPs stake liquidity to earn →
Deeper liquidity →
Even more trading.
This dynamic ensures that as marketplace volume grows, both the distribution and utility of $LIFI expand organically alongside the platform’s success.
Last updated