Meteora Allocates 25% of MET Token Supply for Liquidity Rewards and TGE Reserve

Meteora, a decentralized finance (DeFi) platform built on the Solana blockchain, has proposed allocating 25% of its MET token supply for liquidity rewards and the Token Generation Event (TGE) reserve. This strategic move aims to incentivize liquidity providers and ensure a successful launch of the platform.

The proposal, detailed on Meteora’s governance forum, outlines a 20% allocation for a Liquidity Rewards Reserve. This reserve is intended to provide liquidity mining rewards to incentivize liquidity providers for two years post-TGE. The proposal emphasizes the importance of attracting liquidity providers to maintain Meteora's position as a leading platform for liquidity provision. The funds will be used to match token incentives for major launches, continue the liquidity provider (LP) Stimulus Plan (Season 2), and fund new programs to boost user adoption and liquidity.

Additionally, 5% of the supply will be allocated to the TGE Reserve. This reserve is designated for initial liquidity provision, market-making, and other tasks related to the TGE. The proposal's author, Soju, noted that while 5% might seem low, given that 40% of the circulating supply will be available on day one, the LP Army is expected to shoulder the difference. Many users share Soju’s view, emphasizing the need for sufficient liquidity at TGE to ensure deep liquidity and a successful launch.

This proposal follows earlier initiatives by Meteora to refine its token distribution strategy. On March 20, the platform announced two other proposals. The first aims to increase the LP reward allocation from 10% to 15%, with an additional 3% designated for Launch Pools and Launch Pads. The second proposal suggests allocating 20% of the total MET supply to the Team Treasury, with these tokens vested over six years starting from the TGE.

Meteora’s strategic initiatives coincide with an increase in trader activity. The platform has become the third-largest chain by fees over the past week, generating an impressive $21.6 million. Additionally, Meteora’s fees have rebounded strongly in May, reaching $4.2 million in just the past 24 hours. The substantial fee generation points to a highly successful and engaging ecosystem, with users attributing the success to the platform's airdrop and other incentives.

However, Meteora’s path is not without challenges. The platform faces a class-action lawsuit filed in March for its alleged involvement in the LIBRA token scandal. In the aftermath of the LIBRA crypto crash, Ben Chow, Meteora’s co-founder, resigned from the leadership amid insider trading allegations. Despite these hurdles, Meteora continues to focus on strategic initiatives to ensure its success in the competitive DeFi landscape.