Cardano’s decentralized exchange has announced a new feature to draw in liquidity.
Called “organic APR,” the feature increases token emissions as more liquidity is put into the pool, according to a Twitter thread from the team. It will be introduced into a single pool on Dec. 8 and may be offered in other pools later. The new feature has elicited praise from some Cardano users, but others have expressed dissatisfaction with it.
We have developed something special for you! Organic APR Introducing Organic APR in one sentence:The more people contribute to a pool, the higher the APR Why do we need it? And how would this work? Check out this thread for more information.
The team argued that organic APR is necessary because, without it, users would not be incentivized to proselytize for the exchange. The MuesliSwap team explained:
Some Cardano users have praised the new feature. For example, one user called it “a cool innovation” and another called it “ingenious.”
if i understand correctly, instead of releasing from the get go all the emission rate, and in the beginning there are insane aprs but it goes down quickly.you start slowly, and only release full apr when you reach the liquidity target?ingenious!
But others have criticized the new feature, claiming that it provides unsustainable yields and will cause inflation.
A critic tweeted that the team’s explanation is unclear, asking “Will you make it transparent how many tokens are left and for how long it will last?” And another user stated his dissatisfaction bluntly: “Printing fake value thru inflationary emissions is everything that’s wrong with defi. This isn’t the way forward.”
Printing fake value thru inflationary emissions is everything that’s wrong with defi. This isn’t
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