@limhuiqian99
Liquidity mining is a mechanism in decentralized finance (DeFi) where users provide liquidity to decentralized exchanges (DEXs) or protocols by depositing cryptocurrency pairs into liquidity pools. In return, they earn rewards, typically in the form of the platform’s native tokens. Users stake their assets in a pool, enabling trading and earning fees proportional to their contribution. Rewards are distributed based on the pool’s rules, often incentivizing long-term participation. This process supports market liquidity, reduces slippage, and encourages user engagement. However, risks like impermanent loss and smart contract vulnerabilities should be considered before participating
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