STONfi Introduces Impermanent Loss Compensation for LPs


In a bearish market where liquidity providers (LPs) often face increased impermanent loss (IL), STONfi has implemented an automated compensation mechanism for LPs in its STON/USDT pool.
Instead of traditional yield-based rewards, the protocol distributed 6,546 $STON to partially offset impermanent loss incurred by LPs. The compensation was funded from a $10,000 monthly allocation and credited automatically to eligible wallets, without requiring claims or manual interaction.
Program highlights:
Up to 5.72% of impermanent loss covered
$10,000 monthly compensation pool
Maximum $100 per wallet
Automatic distribution to LPs
While the amounts are capped, the initiative demonstrates an alternative approach to LP incentives by addressing downside risk rather than only rewarding upside performance.
Impermanent loss remains one of the primary risks in decentralized liquidity provision, particularly during volatile or bearish market conditions. Structured IL compensation mechanisms may contribute to more stable liquidity and improved risk-adjusted returns for LPs.
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SHOLEH0Xvip
· 12-29 00:12
Christmas Bull Run! 🐂
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SHOLEH0Xvip
· 12-29 00:12
Merry Christmas ⛄
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SHOLEH0Xvip
· 12-29 00:12
Merry Christmas ⛄
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