💧 Liquidity Incentives
Learn how liquidity rewards pay USDC for resting limit orders, boosting order book depth and improving trade execution for all users.
👋 Introduction - What Are Liquidity Rewards?
Liquidity rewards are USDC payouts provided to users for placing limit orders that sit on the order book and make trading smoother for everyone.
More resting orders in the order book = steadier prices, faster matches, and a better trading experience for all.
💧 Importance of Liquidity
USDC rewards are provided for placing qualifying resting orders within eligible markets, as specified on the Rewards Page. You can also check your accumulated rewards for the day on the rewards page.
These rewards accumulate continuously while a resting order remains active in an eligible market. Payouts are processed automatically to your wallet daily at Midnight UTC.
Rewards play a key role in enhancing order book depth and minimizing price volatility, leading to better trade execution for everyone. When more users contribute liquidity at similar price levels, the daily reward pool is shared among a larger group, resulting in smaller individual shares. Conversely, when fewer users participate, each contributor receives a larger portion of the rewards.
For those seeking a deeper dive into the mechanics of reward calculations, explore detailed technical examples Liquidity Rewards in Depth.
💧 How to Earn Liquidity Rewards?
🔎 How can I tell if my order is earning Liquidity Rewards?
It's simple! Look for a small gift box icon next to your order on the market's Order Book, as shown in the example below.
Alternatively, visit the global Rewards page to see if you’re earning rewards and identify which markets they apply to.
📖 Key Definitions
Liquidity: The pool of buy and sell orders that makes it easy to trade without moving the price much.
Limit Order: An instruction to buy or sell only at a specific price or better, never worse.
Resting Order: A limit order that stays on the order book waiting to be matched instead of filling right away.
Order Book: A live list of all current buy and sell orders at different prices for a market.
Bids (Buy Orders): Offers from buyers showing the highest prices they’re ready to pay and how much they want.
Asks (Sell Orders): Offers from sellers showing the lowest prices they’re willing to accept and how much they’ll sell
For those seeking a deeper dive into the mechanics of reward calculations, explore detailed technical examples Liquidity Calculation Equations.