Droplet liquidity pools
Liquidity pools allow users to provide their liquidity of droplets and $SOL to ensure smoother swapping trades over droplets-$SOL pair, and trading fees from swap + earn liquidity rewards.
For example, when a user mints $DAPE by depositing a Degen Ape, they can deposit their liquidity in equal ratio to the $DAPE-$SOL liquidity pool on AMMs like Cropper Finance. This liquidity will ensure that all the other users who want to swap tokens between $DAPE-$SOL pair can do so smoothly without liquidity issues. In exchange for providing the liquidity, the liquidity providers will receive LP tokens for the $DAPE-$SOL pair. The LP token holders will receive trading fees collected from all the swaps done over the $DAPE-$SOL pair. The LP token holders can also stake their LP tokens to receive liquidity rewards.
To understand how liquidity providing works, we recommend reading: https://raydium.gitbook.io/raydium/exchange-trade-and-swap/liquidity-pools
The liquidity rewards to the LP token stakers will initially be in the form of minting fees collected from the NFT deposits made in the relevant bucket. When the $SVT token (the Solvent platform's governance token) will be launched during the IDO and public sale, the liquidity rewards provided will be in the form of the $SVT token, based on the liquidity provided.
Last modified 1yr ago