Liquidity Provider Rewards
Last updated
Last updated
The LP rewards of Chaintools come from eight different sources, paid in both ETH and $CTLS. We are the first protocol to utilize the Uniswap V3 donate function. It allows the reward amounts to be split proportionally towards liquidity providers with active positions in range of the current price. There is a 0% tax on adding liquidity and 5% on LP removal.
The rewards are added on top of the default 1% pool swap fee.
To bootstrap the liquidity, additional tokens are issued and will be as given as rewards to Liquidity Providers over time.
A portion of the service fees gathered from all utilities will be used to buyback and burn tokens, to add a deflationary aspect to the protocol.
For more information check the flowchart below: