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As per a new Twitter post by SushiSwap CEO Jared Grey, the DEX underwent a thirty million dollars loss in the last twelve months on incentives for liquidity providers. As elucidated by Grey, SushiSwap presently employs a token-based emission strategy to incentivize LPs, but the present rate is “unsustainable.”
He said,
“We commissioned Flipside to build dashboards to showcase these results; we’ll make them available by EOY.”
Moving ahead, Grey plans to rework SushiSwap’s tokenomics so that liquidity providers are no longer subsidized with emissions and redesign the whole model of bootstrapping liquidity on the decentralized crypto exchange.
The DEX executive wrote,
“In Q1 2023, we will bring innovation to scale swap volume & prioritize TVL. As LPs experience a more profitable swap experience, others should migrate to Sushi.”
He further added,
“Put simply, [Kanpai] allows the protocol to rebuild its cash reserves to continue to pay competitive wages, pay for critical infrastructure, & to diversify its Treasury with funds collected in the base pairs of assets, like ETH, stablecoins, etc. Kanpai is a temporary solution.”
Notably, Grey has stayed opaque regarding the design of the new SushiSwap for now, mentioning that he will provide “full financial transparency by releasing public dashboards for DAO & Treasury activity” in the 1st quarter, next year.
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