DeFi Exchange Kyber Teams Up With Polygon In A Bid To Boost Liquidity

The Kyber Network has now officially aligned itself with Polygon (MATIC) in an attempt to improve liquidity via the latest rewards program. The announcement had come yesterday via a blog post, where the network had made it known that it has plans of being deployed on Polygon towards the end of the month.

As per the announcement, a liquidity mining program shall also be added on Polygon as well as Ethereum (ETH), and the rewards are expected to be approximately $30 million in total. The incentive known as ‘Rainmaker’ shall take place on the 30th of June 2021. Through this incentive, rewards will be distributed during a time period of 3 months to those Kyber liquidity providers who are deemed eligible to receive them.

Liquidity needs to be enhanced

The overall goal seems to be the ultimate incentivization for the liquidity developers and providers and get them to start using Kyber DMM through the process of giving high yields on various token pairs which are eligible. This would result in liquidity being enhanced for both Ethereum’s as well as Polygon’s DeFi ecosystems.

Through this move, Polygon’s Layer 2 technology shall be made available on Kyber’s DMM (dynamic market maker). The objective here is to improve liquidity for the two platforms as well as increase the exposure for Polygon’s own ecosystem. To that end, the COO and co-founder of Polygon, Sandeep Nailwal, said that liquidity is an absolutely critical factor when it comes to any decentralized finance ecosystem. As such, he added, Polygon is happy to be working alongside Kyber in a collaborative effort to improve liquidity on the network with assistance from Kyber’s DMM protocol.

Kyber & Polygon tokens to be distributed

A huge amount of $30 million will be allocated in both MATIC as well as KNC tokens for various liquidity providers. These providers shall be receiving LP tokens, which will represent their own respective share of the total pool. Furthermore, these tokens can be subsequently staked in order to earn even more tokens if one so wishes to take this route.

Polygon and Kyber shall hence be distributing KNC tokens amounting to 2.5 million in accumulation, which roughly translates to about $5 million. Moreover, MATIC tokens worth $500,000 shall also be distributed over six eligible and amplified pools present on Polygon itself. Lastly, about $26 million worth of KNC tokens shall be distributed across pre-selected pools that are based on Ethereum.