Pool Incentives
Pool Incentives let projects and third parties fund extra reward streams for liquidity providers in specific Aquarius pools.
Pool Incentives are one of two tools for projects growing liquidity on Aquarius — see Growing Liquidity on Aquarius for the full picture, including how they compare to bribes.
Overview
Pool Incentives allow projects, issuers, DAOs, and ecosystem participants to distribute additional rewards to liquidity providers in specific Aquarius pools.
Unlike AQUA emissions, which are funded by the protocol and allocated through governance voting, Pool Incentives are funded directly by third parties. This allows projects to independently incentivize liquidity and support trading activity in markets that are important to their ecosystem.
Pool Incentives operate alongside existing liquidity provider rewards and can be used to complement AQUA emissions or support pools that do not currently receive protocol emissions.
Purpose
Deep and sustainable liquidity is essential for healthy markets. Pool Incentives provide a mechanism for asset issuers and ecosystem participants to encourage liquidity provision without relying on protocol-funded rewards.
Projects commonly use Pool Incentives to:
Bootstrap liquidity for newly launched assets
Increase liquidity depth in strategic markets
Improve trading conditions by reducing slippage
Encourage long-term liquidity provision
Support ecosystem growth initiatives
Because incentives are funded directly by participants rather than the protocol, projects have full flexibility in deciding how much liquidity support they wish to provide.
How Pool Incentives work
A Pool Incentive campaign distributes rewards to liquidity providers in a specific Aquarius pool over a predefined period of time.
Reward tokens are deposited into the incentive system and distributed automatically to eligible liquidity providers according to their share of liquidity in the incentivized pool. Unlike AQUA rewards, Pool Incentives are not affected by ICE boosts.
Key parameters:
Minimum incentive size: the equivalent of 100,000 AQUA per day at creation time, in any token traded on Aquarius
Minimum duration: 1 day
Up to 4 reward tokens per pool, with up to 10 scheduled incentives per token
See the step-by-step guide: How to create pool incentives.
As long as a campaign remains active, liquidity providers can earn the additional rewards while continuing to receive normal pool trading fees.
Multiple incentive campaigns may exist simultaneously, allowing a pool to receive rewards from several independent sources.
Relationship to AQUA emissions
Pool Incentives and AQUA emissions are separate incentive mechanisms.
AQUA emissions are governed by AQUA holders and distributed according to governance voting outcomes. Pool Incentives are created and funded directly by third parties.
Because the two systems operate independently, a pool may:
Receive AQUA emissions
Receive Pool Incentives
Receive both simultaneously
Pool Incentives do not influence governance voting and do not increase a pool's eligibility for AQUA emissions.
Likewise, governance voting does not determine whether a Pool Incentive campaign can be created.
Asset eligibility requirements
To maintain consistent standards across the protocol, Pool Incentives follow the same asset eligibility requirements as AQUA emissions.
A pool is eligible to receive Pool Incentives only if all assets contained within the pool are approved in the Asset Registry.
This requirement ensures that protocol-supported incentive programs are limited to assets that have undergone governance review and approval.
For more information, see Asset Registry.
Permissionless participation
Pool Incentives are designed to remain permissionless.
Any participant may create incentive campaigns for eligible pools. Projects are free to support their own markets, community members can sponsor liquidity programs, and ecosystem participants can direct incentives toward pools they believe provide value to the network.
This model allows market participants to express support for assets and trading pairs without requiring changes to AQUA governance or protocol emissions.
Transparency
All Pool Incentive campaigns are publicly visible and tracked on-chain.
The Aquarius interface displays active incentives, reward assets, distribution rates, and eligibility status directly within the pools interface. This allows liquidity providers to evaluate available opportunities and understand the complete reward profile of a pool before providing liquidity.
Combined with governance-controlled asset eligibility, this creates a transparent and predictable framework for liquidity incentives across the Aquarius ecosystem.
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