Strategic Incentive Considerations
Maximizing Incentive Earnings:
- Monitor which pools are receiving incentives each epoch
- Adjust votes toward heavily incentivized pools
- Balance between high-incentive pools (competitive) and moderate ones (less competition)
- Consider the 1 DXLYN cost to update votes vs. potential incentive gains
Synergy with Liquidity Providing: The most profitable strategy often combines:
- Provide liquidity to a pool
- Vote for that same pool with veDXLYN
- Earn emission rewards as an LP
- Earn incentive rewards as a voter
- Earn trading fees from the pool
- Quadruple reward streams from one position
Incentive Wars: In competitive DeFi ecosystems, “incentive wars” occur when:
- Multiple parties incentivize the same pool
- Voters rush to allocate power to highest-incentive pools
- Incentive amounts escalate as parties compete
- Early voters to incentivized pools often earn the best ratios