2026-01-03 02:24:13

Regarding the recent online buzz about "protocol revenue" comparisons, a well-known DEX founder clarified some points that are easily misunderstood.

He pointed out that some projects in the market collect 100% of LP fees and then return them to liquidity providers through token incentives. This operation looks particularly impressive on the books, and the numbers are indeed eye-catching. But the problem is—this does not equate to truly sustainable revenue.

Why? Because the actual earnings of LPs depend entirely on the value of those incentive tokens. Once the token price fluctuates or drops, the actual earnings of LPs will significantly shrink. Under this model, the sustainability of revenue is actually quite fragile.

Compared to the model where revenue is accumulated through real market fees, the fundamental differences between the two are quite significant. The former is more like "bookkeeping prosperity," while the latter is truly "blood-making capacity."

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LightningSentry

· 10h ago

It's the same old "air stimulation" trick, I'm already tired of it. It's a classic hot potato, and by the time it reaches you, it's just a pile of worthless paper.

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ShibaMillionairen't

· 10h ago

It's the same old "incentive token" trick again, and LPs are still hoping for the value increase of air coins. Even if the on-paper numbers look good, it's all meaningless; a token dropping by half is not surprising at all. The truly valuable ones are protocols that can reliably siphon funds; don't be fooled by 100% transaction fees. These projects rely on hype and data manipulation to attract attention, but once the hype dies down, it's a mess.

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SchrodingersFOMO

· 10h ago

Another project that exaggerated the numbers has been exposed. This is the crypto world. Wait, no, there's actually a bit of a logical problem here. Real transaction fees might not be able to support it either. I've seen many cases of token incentives shrinking. It still depends on whether the underlying has genuine trading volume support.

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DeFiDoctor

· 10h ago

It's the same "incentive token" trick again. After watching the clinical performance of DEX projects for so many years, I haven't seen many that end well. The numbers look good on paper, but once the token loses value, the true nature is revealed—this is a chronic disease that will eventually relapse. Genuine self-sustaining ability is what truly matters; transaction fees are the real deal, and incentives are just a life-extending medicine.

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