- GP10 Targeted DeFi Rewards distribution plan

Hi Algorand, please see’s TDR distribution plan for GP10: Liquid Staking Will Receive DeFi Rewards Boost From Algorand Governance P9 | by | Jan, 2024 | Medium


I don’t think adding incentives to just minting mALGO should be allowed. It doesn’t add any value to anyone besides messina being able to get even more defi boost next period aka milking the governance reward more.

Messina should focus on usecases and making mALGO not another LST that nobody uses besides to farm more rewards coming from the defi boost.

Also mALGO doesn’t really need liquidity on DEXs because it can be redeemed at any time, so the rewards shouldn’t be just shifted to that either



I think incentives for minting mALGO is ok for couple first periods to onboard more users. But can’t be long-term thing.

I strongly disagree with this: “mALGO doesn’t really need liquidity on DEXs because it can be redeemed at any time”. It is crucial to have a lot of liquidity on DEXes, because this allows new investors/holders to onboard in the middle of the Gov period or when ever they want. This blurs the Gov periods and helps to prevent that TVL drop between Gov periods what has been big concern. Also from ecosystem and user experience point of view, it benefits us all if ecosystem is more vivid and diverse. Point is not to optimize all the liquidity pools and gate keep what is allowed and “efficient” and what isn’t. Let people trade as they see fit, also higher TVL gives more legit reputation among users. This is just how human mind works. Also deep mALGO TVL will increase whole Algorand TVL, what is the whole point of these incentives. So I think these LP incentives are 100% right thing to do.

I just want to ask, do you have any other ideas where to allocate these?

Best regards,


Ok onboarding during periods is a good point. Only looked at mALGO from the perspective as someone who minted it

Tough question as there is sadly not a lot to do on Algorand. But I thought that NFT people could like mALGO more than gALGO because they can immediately redeem them if they need to and don’t risk loosing anything. So rewards for purchases using mALGO? Integration into the classic marketplaces including NFD

Honestly also hoped for a an earlier audit and getting mALGO onto FF as an asset…

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I agree that it needs more use cases, But I think good to first onboard more users and get liquidity in place. then maybe next period focus should be in use cases and broader adoption.

For example maybe next period Messina can incentivize Folks deposits, liquidity pools on DEXes more broadly to help aggregators, boost xBacked vaulting and then incentivize some use cases.



Also people just minting mALGO is not really adoption that anyone needs. We don’t need xyzALGO which just gets used to farm low risk pairs on DEXs and thats it


Not sure how giving Messina rewards just to fund their liquidity for mAlgo is beneficial for anyone. They created a token that they don’t have enough liquidity for, haven’t incentivized much with it at all and now using rewards to pump up there numbers?

TVL does not guarantee high reputation. This is the same as Vote Coin. Got a grant to use to pump his TVL even though no one is using the product.

There is still no clear answer from the write up on how they will onboard new users. The only thing that matters is new users.

LP incentives give DeFi platforms a chance to not do anything at all and still get help.

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mALGO is great tool for onboarding new users. If you follow conversation on any Algorand related chat or platform, always people ask how governance works, they missed it, “ok I will come back later”, “too confusing”, “I will check later”. Even my brother said that “yeah, I will check maybe later”. It is very different from other chains, so this blurs the gap between gov periods. it is different question is it good to give easy governance rewards or not, but if we want more users and make this simple, then mALGO is brilliant tool for that. We can’t sit in our ivory towers and judge people based on how they will farm or take advantage of things. basically it is what it is, and no need to spend resources to moral guard.
Also that pump TVL, it is good to have liquidity in place because it makes things easier, also gives more legit reputation to mALGO, makes swapping easier → more trades → more tx & more vivid ecosystem. Many times people see these things in silos. I hope platforms will collaborate more and optimize these incentives from ecosystem point of view. this probably will not happen, but mALGO fits into whole Algorand ecosystem very well.


I get your point but reality is any token can do what mAlgo is doing or use it to onboard. If this was a good strategy then gAlgo would have taken off or any other Folks Finance created token. Instead they rely on inside money to prop up these TVLs to give “good reputation”. If a tokens utility is txns, more trades and easier swaps then that is not enough to receive funding.

I see DeFi platforms creating their own token to inflate their own TVL with free money from the foundation but not have any utility and hope of giving themselves high TVL to look better and gain more fees for themselves. But does not grow the market at all

Hi all,

Thank you for your thoughts and insightful comments. mALGO is rather new to the ecosystem and because of the long governance periods perhaps a little slower to develop since it is linked to these quarterly periods.

In the first governance period we did not expect a large amount of deposits so we credited the TDR to help boost the attraction of the yield and we managed to get 8 million ALGOs in deposits which was encouraging but still relatively small in the liquid governance category and the TDR boost ended up being 1.8% extra. For reference, gALGO got over 400 million ALGOs in deposits in the same period.

During this first governance period we underwent an audit with CertiK and just got it out on 2 January 2024, so with this we hope more people will feel secure and trust the protocol so we receive more deposits. We also managed to launch voting in the first governance period so people now know they can vote through us which is an important part of governance. With these 2 things in place, we believe user confidence in the platform will grow.

With the first governance period under our belt and the audit in place, we are in a better position to work with partners to create use cases for the token. In the first period the community organically created pools on Pact and Tinyman but they had very low liquidity. This period we have partnered with Pact and Tinyman to create farms with our TDR and we have already seen the benefit of this with the TVL in those 2 pools growing several fold, and we hope to see it continue to increase. We are also seeking partners to create pairs for other tokens. AlgoRai Finance used some TDR of their own last quarter which attracted a decent volume of TVL, so we are adding TDR this quarter in partnership with them to hopefully grow that category as well.

We are also in discussions with xBacked and Folks Finance to try and get the token listed with them. They were not comfortable doing so before the audit was completed, so now with the audit done we hope to have these use cases up soon. However since these are not confirmed and we do not have a timeline, we are unable to allocate TDR to them.

This quarter we worked with partners on a matching basis so given limitations of allocating TDR to a new token, we could not allocate all of our TDR to partner pools exclusively. Why not add more on our own you might ask? We tried to come up with a philosophy on how to execute this fairly with partners, we do not want a scenario where people question if we favor one partner over another. So for this period we are basing it on what they are willing to match us with. We hope to refine this and find better ways to allocate TDR distribution in future, especially if we have more to distribute. For this quarter we have 181,671 ALGOs to distribute, which is by no means small, and puts us 9th out of 10 in the TDR program.

With the remaining TDR we are allocating this to the liquid staking pool as the pool is still small enough for it to have some impact albeit small. One other avenue we would like to incentivise in future are the liquidity pools for our bridge, however as these are not currently public we do not feel its appropriate to do so at this time. We have plans for them to be public in future so anyone can add TVL to the bridge pools and if we have TDR it will be a boost to them in future.

Thank you for your time and consideration, and we hope we will be able to continue adding value to the Algorand ecosystem and you find our platform useful. We look forward to any suggestions for improvement, kindly reach us at


Thanks for the response.