Allocate 1M XPRT to boost DEX-Liquidity

[dneorej]

Introduction:

This post aims to kickstart a conversation and gather feedback from community members about the proposal to allocate 1M XPRT from the community pool for adding incentives on Persistence DEX and other DEXes where XPRT is present.

I encourage everyone to participate in the discussion and share their thoughts, opinions, and suggestions.

Details about previous incentivization proposal:

On August 28, 2024, the Persistence community approved Proposal #114, allocating 1,000,000 XPRT to incentivize liquidity on the Persistence DEX and other DEXs featuring XPRT pairs. These incentives have been instrumental in enhancing liquidity and volumes for multiple pools on Persistence DEX (formerly Dexter), Osmosis and Aerodrome…

As of 10 February 2025, 47,368.97 XPRT remain in the designated multisig wallet which will be clubbed along the proposed proposal and will be used for future incentivisation.

Multisig Address: persistence1xkhjn2pl7hduku2ue8f2z8atxywz4clxantaxp

Note that for security reasons, a new 2/3 multisig will be used for this proposal with the following address: persistence1fn5td7lw575xwhuyjtvearzc8p546mj6agaw0c

On avg 169,200 XPRT were spent in the last 5 months for XPRT incentives on various pools.

Pools Incentivised on Persistence DEX: PSTAKE/XPRT, USDC/USDT, XPRT/ATOM, USDT/XPRT, stkXPRT/XPRT, XPRT/WBTC

Pools Incentivised on other DEXes: Osmosis (OSMO/XPRT and XPRT/BTC), Aerodrome (XPRT/USDC) and Velodrome (XPRT/USDC)

Key metrics for Persistence DEX:

During the incentives period, Total volume on Persistence DEX clocked to $32.62M

TVL declined together with the overall market, however average yields on the pools remained high enough to sustain healthy levels of TVL to support trading volume.

Distribution of the proposed 1M XPRT tokens:

These tokens will be used to maintain the incentives on Persistence DEX and other DEXs (Osmosis, Aerodrome etc) which will help maintain liquidity for XPRT.

These tokens will be used over approximately 6 months.

The incentives allocations will be reviewed every month and adjusted accordingly based on the performance of the pool. As a standard for Persistence DEX, an on-chain proposal (as below) will be created before every incentivization cycle (i.e. 1 month)

Previous Proposals for Persistence DEX XPRT Incentives:

Month	Proposal Number	Link
September 2024	115	Mintscan
October 2024	117	Mintscan
November 2024	118	Mintscan
December 2024	120	Mintscan
January 2025	122	Mintscan
February 2025	124	Mintscan

Key questions for discussion:

1. Do you agree with the proposed XPRT number? If not, what do you suggest?
2. Do you have any other suggestions on how to maintain / grow liquidity for the DEX?
3. Are there any additional considerations you would like to bring up regarding this proposal?

We value the input and opinions of our community members, and I hope this discussion will help us better understand the needs and priorities of the Persistence ecosystem. Please share your thoughts and contribute to the conversation.

Looking forward to your insights and ideas!

[Idrees4u]

This is a nice proposal. However,some certain factors should be considered
Like

1. The current market liqiudity

If the liqiudity is already High,the effect of 1Mill. XPRT might be marginal,might be a good turning point if the liqiudity is relatively low.

2. What Approaches measures were taken by similar project in maintaining and providing liq?3.
3. Is there consensus or opposing view of the community?

Let’s consider some DEX like UNISWAP,SUSHISWAP,OX protocola and many others and how they approach the issue

When UNISWAP faced signicant liq. Problem due to the new AMM

UISWAP introduced liqiudity Minning with it’s UNI token rewarding users who provide liqiudity to pools with governance token
It also foster community engage by allowing community to decide on future liqiudity incentives

SUSHISWAP(a fork of UNISWAP) also struggled with liqiudity after it’s controversial launch. The issue was approached by the following methods

1. Offer SUSHI rewards to liq. Provider
2. Diversification and expansion to multiple Blockchain

OX protocols and Kyber Networks also struggled with maintaining and building liqiudity.

Some of the proven methods used by DEXes in maintaining liquidity are highlighted below:

1. Liqiudity Aggregation
2. Innovative tokenomics(burning,Buybacks and staking)
3. Strategic partnership with good project including cross-DEX liqiudity pools and integration with major wallets
4. Liqiudity Minning program

To make an informed decision,it is the responsibility of the Team to weigh the pros and cons of each methods and decide the one that fit long-term strategic operation.

In conclusion,my suggestion is that
Instead of releasing the 1million XRPT Once,you can consider a staged approach where tokens are allocated over time based on performance metrics like trading volume,new liqiudity providers or KPI’s.

Thanks

[SuperEra]

Support this proposal. The proposed 6-month duration feels balanced—neither too short to keep repeating nor too long to adapt if needed.

I also appreciate that the remaining funds from the previous incentive program will be combined with this proposal, ensuring efficient use of resources.

While 1M XPRT seems like a reasonable starting point, I recommend closely monitoring performance metrics and adjusting allocations if necessary.

For me, this plan aligns well with the long-term growth of XPRT liquidity and strengthens Persistence’s position across multiple DEXes

[pl99]

What other objectives does persistence aim to achieve beyond incentivizing the pools? It appears that this approach has been in place since the launch of the decentralized exchange, yet it has not yielded significant results; the pools remain inactive with minimal trading activity. For persistence dex to thrive, it is essential to implement strategies beyond mere incentivization, as this only exacerbates the selling pressure. I firmly oppose this proposal and advocate for allocating more XPRT towards enhancing the staking percentage of the chain, along with conducting a staked stake drop for stakers each month over the next six months.

[Abramlinco]

1. The 1M XPRT allocation is a strong initiative that could significantly boost DEX liquidity. Implementing a performance-based release schedule might ensure sustained participation and long-term benefits.

2. Drawing insights from successful DEXs like Uniswap and SushiSwap could help Persistence optimize this liquidity boost while maintaining sustainability.

3. Incorporating mechanisms like staking rewards or token buybacks alongside this allocation could further strengthen liquidity and enhance the ecosystem’s overall growth.

[Pawel_PK]

Hi Jeroen, thank you for quality rationale with solid data behind the proposal. What about using community pool for building lp liquidity instead of spending it for rewards? Very similar to Atom borrowed from Cosmos Hub to build atom/stkatom liquidity on Persistence dex?
This is another way to address very low liquidity for XPRT.
Maybe some collaboration with Centralized Exchanges involved in YBTC to build higher XPRT liquidity on them?

I would rather then focus on actions supporting long term holding and building demand like Stakedrop campaigns or rewards for tasks achieved via interaction with the chain or being active on X, Telegram or forum?

Best regards

Pawel

[LeonoorsCryptoman]

@dneorej The previous incentives were aimed for liquidity, right? In that case it would be hard to consider the incentives a success if the conclusion is that TVL declined… I would surely challenge if it would be best to go forwards with new incentives which have been proven to be questionably effective, while the proposal of @Pawel_PK offers an interesting different route which needs to be explored.

Does the Persistence treasury only contain $XPRT? Or does it also contain other assets, which make it relatively easy to do Protocol-Owned-Liquidity?

[dneorej]

@Idrees4u

This is a nice proposal. However,some certain factors should be considered

Thank you for the inputs. I agree incentives should be considered based on the value addition to the overall pool activity or volume. Therefore the incentives would be added one month at a time so that incentive tokens can be adjusted strategically.

Incentives always act as a catalyst for most of the DEXs as more incentives builds deeper liquidity which helps in reducing slippage and increasing volumes. However the efficacy of the incentives drops off at a certain point, which is why it would be wasteful to add too many incentives too. If we take the incentives away or reduce them too much (as some people suggested), liquidity will go away and it trading will become less efficient leading to lower volumes. Unfortunately LPs are still mercenary capital, and capital goes where there are returns.

@pl99

What other objectives does persistence aim to achieve beyond incentivizing the pools? It appears that this approach has been in place since the launch of the decentralized exchange, yet it has not yielded significant results; the pools remain inactive with minimal trading activity. For persistence dex to thrive, it is essential to implement strategies beyond mere incentivization, as this only exacerbates the selling pressure. I firmly oppose this proposal and advocate for allocating more XPRT towards enhancing the staking percentage of the chain, along with conducting a staked stake drop for stakers each month over the next six months.

The objective of these incentives is to increase or at least maintain the current liquidity numbers. An illiquid token is harmful to the ecosystem, especially with the upcoming mainnet launch for the BTC interoperability product. XPRT-stakers will benefit from that product (on top of the already high staking rewards). Keep in mind with the current inflation, over 2M XPRT per month goes to stakers already, hence allocating more XPRT towards staking seems excessive to me.

@Abramlinco

Incorporating mechanisms like staking rewards or token buybacks alongside this allocation could further strengthen liquidity and enhance the ecosystem’s overall growth.

We once ran a rebate program for stkATOM/ATOM pool active traders on Persistence DEX hence we can have a look at the same strategy and can implement it other pools if it makes sense. It typically helps though to incentivise one-directional trading to rebalance a pool, but most of the pools are pretty well balanced actually at the moment.

@Pawel_PK

What about using community pool for building lp liquidity instead of spending it for rewards?

Using community pool for building LP liquidity will not be beneficial because Persistence DEX doesn’t support single side liquidity. However it could be used for stkXPRT/XPRT as that is a metastable pool but this pool already has the highest Liquidity and volumes on the DEX so it would make more sense to use these tokens for pools which are not performing well.

@Pawel_PK

I would rather then focus on actions supporting long term holding and building demand like Stakedrop campaigns or rewards for tasks achieved via interaction with the chain or being active on X, Telegram or forum?

I personally think stakedrops are a bit dead now, only attract airdrop farmers with that but nothing sustainable. I do like the idea of trying to drive more social interaction, although that’s also something we’re already doing through the various quests on zealy, questn, etc…

@LeonoorsCryptoman

@dneorej The previous incentives were aimed for liquidity, right? In that case it would be hard to consider the incentives a success if the conclusion is that TVL declined… I would surely challenge if it would be best to go forwards with new incentives which have been proven to be questionably effective, while the proposal of @Pawel_PK offers an interesting different route which needs to be explored.

Does the Persistence treasury only contain $XPRT? Or does it also contain other assets, which make it relatively easy to do Protocol-Owned-Liquidity?

That’s true, the overall TVL declined due to the discontinuation of stkAssets by pSTAKE and macro alts condition. However the incentives helped in maintaining the liquidity of XPRT. In XPRT terms, the liquidity has actually been quite stable around 6M XPRT. I don’t have easy access to older data, but see attached a graph showing pretty constant liquidity despite price movements.

We’ve had it in the past where incentives were not added on time and gone for a few days, and liquidity gets removed so quickly in those cases and it’s hard to build it back up. Therefore I strongly suggest to continue the incentives to at least maintain the current levels and ensure XPRT is still an option for traders as there is sufficient DEX liquidity.

Hope these answers clarify the thought process for the proposal.

[Noni]

I agree with your proposal.
I have a suggestion in support of growth:- add an official links channel in Persistence discord.
The discord member count is over 14800 and yet there are only links to Docs, there are no links to the DEX, this forum, the blog, or main website.
Official links will promote and give focus to what Persistence offers, especially the DEX.

[Cosmick777]

1. I would have to support the adding of 1m XPRT to liquidity, it would be a good idea to support the liquidity on the DEX’s. I can see once the BTC interoperability goes live after testnet there will be a strong interest in Persistence from out side the community with this innovative idea. As anything Bitcoin at the moment is a new narrative in crypto with hugh interest, I can see large numbers coming on board the community with more holders and stakers, so providing more liquidity will be needed.

2. When transactions start to flow once mainnet goes live there will be more revenue for Persistence One to add to the community pool in return benefiting liquidity and stakers.

3. Reading what has been said I am not sure if adding more staking rewards for the stakers will help liquidity unless the stakers add liquidity to the pools, I maybe missing something here not sure. As a staker I would love more rewards but since testnet the APR has risen 5-6% so getting more I think would take away liquidity which can be used to help the ecosystem. More to the point, doing more marketing would be a good solution so more people would be aware of what Persistence One is doing with BTC interoperability before mainnet launch, bringing in more people to the community.

[mishko]

I think this will only devalue the existing tokens and move the token value closer to $0.15, therefore I will vote against this proposal. The project needs to create value other ways rather than the money printer goes burrrrrrr.

[dneorej]

Thanks for all the valuable contributions here, the proposal was posted on chain in the meantime: Mintscan

Inspired by some of the suggestions here, I also went ahead and created another forum discussion for an additional and sustainable source of DEX-liquidity: Persistence DEX Protocol Owned Liquidity

Thanks again

[Nico]

@dneorej I am 100% backing this as we do need this liquidity and will be beneficial to get XPRT on everyones radar and boost our organic growth.
If not mistaken I think the voting ends on Feb 23, however when is the first batch expected to be released once proposal has passed?

Or even better, we can supercharge organic growth, by realising 2 batches rolled into 1 this month and assess needs as things progress. My only concern is that we have plenty of catching up to do and sometimes its best to have a liquidity boost feed vs a drip feed.