SushiSwap Cuts Block Rewards to 100 SUSHI

SushiSwap blew up on the promise of outsized rewards for those who got in before the automated market maker (AMM) actually started making markets: 1,000 SUSHI tokens per block for liquidity providers (LPs) who committed before it went live.

It was a deal good enough to lure in almost $1.6 billion worth of various crypto assets, but now those heady days of outsized rewards are over. As planned, each block reward has dropped to 100 SUSHI as of 23:10 UTC or Ethereum block 10850000.

Now that SushiSwap is serving up less SUSHI, it’s anyone’s guess as to what will happen to the piles of crypto locked up in SushiSwap’s smart contracts.

SushiSwap successfully migrated over $800 million in crypto assets from rival automated market maker (AMM) Uniswap on Sept. 9, using Uniswap tokens entrusted to the upstart project by users seeking those SUSHI block rewards.

Read more: SushiSwap Will Withdraw Up to $830M From Uniswap Today: Why It Matters for DeFi

Liquidity in SushiSwap currently stands at $1.46 billion in crypto assets, according to the site’s community-built block explorer, SushiSwap Vision. Uniswap meanwhile has $539 million, according to DeFi Pulse.

SUSHI is currently trading at $2.45 as the bonuses end, off its seven-day high of $3.17, according to CoinGecko.

All about yield

Crypto denizens want to change the world, sure, but what they really want is money.

Giving away a fresh token has become an obvious way for new protocols to compete with the market leaders. Liquidity mining is a category of yield farming where liquidity providers (LPs) earn an additional token beyond whatever fees they earn from the underlying protocol. The growth hack was pioneered by DeFi lending platform Compound in June, with its COMP governance token kicking off cascading innovations in the following months.

In this instance, both Uniswap and SushiSwap hang on to 0.3% of each transaction in their pools, expressed in whatever tokens are in the pool. But SushiSwap also distributes…

Read More