According to the latest research, one of the industry’s largest DeFi protocols is facing an incentive crisis. In his report, Alex Kroeger, an Ethereum researcher, found that most Compound’s liquidity miners have little to no economic interest in the protocol and do not participate in the protocol’s governance.
The report analyzed the top 100 accounts by accrued COMP from liquidity mining in order to demonstrate that liquidity mining on Compound needs serious fixing.
Compound’s miners aren’t hodlers
One of the first protocols to introduce liquidity mining, Compound quickly grew to become a DeFi powerhouse. With over $12 billion in total value locked (TVL), it’s the fifth-largest DeFi protocol according to Dapp Radar.
But, paying out incentives to users to those that contribute liquidity to the protocol comes at a cost. Researcher Alex Kroeger argues that liquidity incentives dilute token supplies and rewards users that contribute nothing to a protocol’s governance
We współpracy z: https://cryptoslate.com/less-than-20-of-compunds-liquidity-miners-hold-any-comp-tokens-at-all/
