Pendle shifts all joint incentives to limit orders, stating that LO has contributed 71% of the trading volume
BlockBeats reported that on May 26, DeFi yield protocol Pendle Finance announced it will focus co-incentives on its Limit Orders (LO) mechanism to enhance platform liquidity depth and trading execution efficiency.
Pendle stated that since launching the comprehensive LO incentive system about two months ago, the proportion of Limit Orders in total Swap trading volume has increased from 44% to 71%. The monthly LO trading volume has nearly doubled, and Limit Orders are now the main driving force behind Pendle's trading activity.
Data shows that Pendle currently allocates about 6,500 PENDLE incentives weekly to Limit Orders, supporting approximately $400 million in notional order book depth. The platform claims that on an annualized basis, each $1 of incentive generates about $800 in liquidity, achieving capital efficiency of about 800 times.
Pendle also announced new co-incentive rules: if projects provide incentives in PENDLE, each $1 provided will receive an additional $0.22 in PENDLE rewards; if incentives are supplied in other tokens, each $1 provided will receive $0.15 in PENDLE. If overall demand exceeds the weekly cap of 9,000 PENDLE incentives, rewards will be distributed proportionally.
Pendle stated that the LO mechanism has proven to be the most effective tool for improving market quality and liquidity depth, so future co-incentives will primarily be focused on the Limit Orders ecosystem.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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