This proposal aims to enhance Meteora’s liquidity by introducing a dynamic reward system for liquidity providers (LPs) and integrating community governance to ensure sustainable growth.
Proposal Details:
Problem:
Meteora, as a DeFi platform, likely faces challenges with liquidity pools that suffer from low participation, leading to high slippage and poor user experience. Additionally, users may feel disconnected from decision-making processes, reducing community engagement and long-term commitment to the platform.
Solution:
Dynamic LP Reward System:
Introduce a tiered reward system for liquidity providers based on the amount and duration of their contributions to Meteora’s pools.
For example:
Tier 1: Provide liquidity worth $1,000-$5,000 for 30 days → Earn 1.5x $MET token rewards.
Tier 2: Provide liquidity worth $5,001-$20,000 for 60 days → Earn 2x $MET token rewards.
Tier 3: Provide liquidity worth $20,000+ for 90 days → Earn 3x $MET token rewards + exclusive governance voting rights.
Rewards will be distributed weekly, with a bonus multiplier for LPs who maintain their position without withdrawing early.
Liquidity Mining with $MET Staking:
Allow users to stake their $MET tokens to boost their LP rewards further. For every $MET staked, users can increase their reward multiplier by a small percentage (e.g., 0.1% per 100 $MET staked, capped at 2x).
This encourages both liquidity provision and $MET token holding, reducing sell pressure and improving token stability.
Community Governance for Pool Prioritization:
Create a governance system where $MET holders can vote on which pools receive additional incentives each month (e.g., higher reward multipliers or bonus $MET airdrops).
This ensures that liquidity is directed toward high-demand pools, reducing slippage and improving the trading experience for users.
Referral and Onboarding Incentives:
Introduce a referral program where existing LPs can invite new users to provide liquidity. Both the referrer and the new user receive a one-time $MET bonus (e.g., 50 $MET each) once the new user provides liquidity worth at least $500 for 30 days.
This drives organic growth and increases the number of active LPs on the platform.
Expected Outcomes:
Increased Liquidity: The dynamic reward system and staking incentives will attract more LPs, deepening liquidity pools and reducing slippage.
Stronger Community Engagement: Governance voting empowers $MET holders, fostering a sense of ownership and encouraging long-term participation.
Sustainable Growth: The referral program and tiered rewards ensure a steady influx of new users while retaining existing ones, creating a positive feedback loop for liquidity and platform activity.
Implementation Timeline:
Week 1-2: Develop and test the smart contracts for the dynamic reward system and staking mechanism.
Week 3: Launch a community vote to finalize the reward tiers and select the first set of prioritized pools.
Week 4: Roll out the Liquidity Boost Program with a marketing campaign to attract new LPs.
Ongoing: Monitor liquidity metrics and gather community feedback to adjust reward multipliers and governance processes as needed.