💧Liquidity Farming

Liquidity farming is a popular mechanism that allows users to provide liquidity to a protocol in exchange for rewards. By locking up their assets into a pool, users earn a portion of $LCD as compensation. This process not only benefits the Lucidao project but also provides users with an opportunity to earn passive rewards.

Benefits for the Protocol

• Increases the liquidity of the $LCD token, making it easier for users to trade and reducing price slippage during large trades.

• Incentivizes users to hold and trade the $LCD token, increasing demand and potentially driving up its value.

Benefits for Users

• Earn passive rewards by locking up assets and receiving rewards in the form of the $LCD token.

• Potential returns if the value of the token increases over time.

How it works

1. Users provide liquidity to the protocol by depositing assets into a pool.

2. In exchange for their contribution, users receive a portion of the protocol's native token as a reward.

3. The amount of reward earned is proportional to the user's share of the total liquidity in the pool.

4. Users can withdraw their assets and rewards at any time, although doing so may result in lower rewards.

By participating in liquidity farming, users can earn passive rewards from the appreciation of the $LCD token. Additionally, the increased liquidity of the token benefits the protocol and its ecosystem as a whole.

How to provide liquidity on Quickswap

View our How-To-Guide Here