Defi’s maturity of a paradoxical technique: While the code rules tested in the battle and the high technical efficiency have reduced the entry barrier to launch new protocols, insurance sustainable liquidity was not more difficult. Since thousands of projects built on unified infrastructure are increasingly competing for a limited group of capital, the ecological system faces a regular challenge that threatens to innovate and real growth.
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The problem of multiple dimensions
The liquidity is fragmented in Defi via protocols, chains and distinctive symbol pairs. For new protocols, insurance is sufficient liquidity – without them, user dependence kiosks, high costs, revenue and the failure of the budget web in growth. This creates a fundamental challenge: all the DEX platform, the new lending platform or the farm must compete on the same limited collection of capital, which leads to the division of available liquidity. The demand for liquidity greatly outperforms the flow of the new capital.
The concept of the traditional financing of “capital cost” has evolved to the “liquidity cost” in Defi, but without uniform work frameworks to prosecute these risks, the protocols are fighting in order to obtain the capital they need to launch and grow effectively. Protocols use original symbols, ecological system boxes and sometimes their capital to attract premature liquidity. Some unreasonable subscriptions, and failed to attract liquidity providers. Others suffer from excessive approval, depletion of the cabinet and create the sale of pressure when canceling the symbolic incentives lock. Both the two rituals ultimately undermine the long -term sustainability.
Tension VC-PROTOCOL
This singer creates a fundamental tension for VC support projects. Investors who finance companies through simple agreements for future symbols (SAFTS) want protocols to attract adequate liquidity of growth and benefit. However, aggressive liquidity incentives programs directly reduce the distinctive symbol property.
The result is often not sustainable: high primary emissions of bootstrap, which creates artificial success standards that collapse when the incentives decrease. This style hinders the real innovation, as new methods really face unparalleled costs to attract capital.
The market is not the lack of consistency of information
The problem is exacerbated due to the lack of transparency. The most important liquidity arrangements occur through dealing with unclear conditions. New protocols do not have any clarity in market prices for similar arrangements, while players and networks from the inside control the flow of capital.
Without parties to assessing unified risk, liquidity providers are struggling to evaluate opportunities effectively. This leads to unintended risk installments through similar protocols and the concentration of capital in projects with familiar designs instead of superior technology and innovation.
Towards a solution: a neutral liquidity layer
What the ecological system needs is the communication between capital and protocols-a layer of fair chain, which focuses on directing effective capital. Such a system:
- Create a vision in liquidity costs through protocols and chains.
- Serving modified criteria by risks for different protocol categories.
- Enable protocols to organize sustainable incentives models.
- Helping capital providers strategically based on transparent risk standards.
The creation of a system like this is not related to the introduction of new financial products, but the creation of a joint understanding of liquidity prices that are compatible with incentives between capital and protocol allocations.
We look forward
With DEFI maturity, uniformity of liquidity coordination and risk assessment will be necessary for capital efficiency. The protocols that flourish should be those that solve real problems and achieve real innovation into space, and not necessarily those of the most aggressive incentives.
The challenge is clear: the demand for liquidity in Defi is unlimited effectively and the limited offer is important. However, the infrastructure, services and pricing mechanisms that determine how the capital flow from the holders to users has greatly left the protocol. The processing of this infrastructure gap is not an opportunity to increase efficiency, but a necessity for the sustainable growth of the entire Defi ecosystem.
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