Range Based Incentives

Range-Based Incentives introduce a targeted approach to incentivizing liquidity in AMMs, especially those using concentrated liquidity models.

Instead of distributing rewards evenly across all liquidity providers, these incentives focus emissions on LPs supplying liquidity within targeted tick ranges, aligning rewards with areas where liquidity is most needed.

The traditional approach to distributing incentives targets all in-range positions. Introducing range-based incentives will allow the creation of campaigns that focus on specific price ranges or bands.

For example, in a DAI/USDC pool, a narrow range (0.995 – 1.005) could be incentivized to concentrate liquidity where it’s most needed.

This approach maximizes liquidity depth in critical zones, reduces slippage, and improves capital efficiency.