Report: The Ten Commandments of Liquidity Incentives

The numbers tell a stark story of systemic capital flight in decentralized  finance.                  Across five years and 160 programs, protocols discovered that attracting liquidity and retaining it are fundamentally different challenges.

While the average program launched with nearly $60 million in deposits,the median outcome was pretty catastrophic: losing half of all capital within a month of ending token rewards.

Yet within this expensive education lies a pattern that separates spectacular success from total failure. The data reveals a bimodal distribution where programs either achieve retention above 90% or collapse below 25%, with very little middle ground. This isn‘t random; it‘s predictable based on adherence to ten fundamental design principles
derived from billions in departed capital.

The protocols that understood these principles transformed mercenary farmers into committed stakeholders, converting temporary subsidies into permanent value creation. Those that ignored them joined the 78% majority that hemorrhaged capital when the music stopped. The choice between these outcomes isn‘t about luck, timing, or market conditions. It‘s about design.

Read our full report here .