3.3.2 Liquidity Provision and Market Stability
To ensure that the platform’s tokens and project assets have sufficient market liquidity, the Farming system encourages users to provide liquidity to the project’s liquidity pools. By contributing token liquidity to these pools, users receive platform tokens or project tokens as rewards. The existence of liquidity pools not only helps improve the market liquidity of project assets but also contributes to the stabilization of the token’s market price.
Liquidity Mining: Users can participate in liquidity mining by providing funds to the liquidity pool. This mechanism ensures that the project tokens have sufficient market circulation after issuance, preventing excessive price fluctuations during the early stages of token release.
Reward Mechanism: Liquidity providers receive rewards based on their share in the liquidity pool. These rewards can be in the form of platform tokens, project tokens, or other types of assets, incentivizing users to contribute to the project's stable growth.
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