Flywheel

Beradrome and THJ have joined forces in an exciting collaboration to launch a validator on Berachain, taking decentralized finance to new heights. As two prominent players in the Berachain ecosystem, their partnership aims to enhance the security and efficiency of the Berachain network and enrich those actively using the chain.

One of the key features of this collaboration is the introduction of a validator reward system. Validator rewards & MEV proceeds will be distributed to hiBERO stakers and active bribers, adding an extra layer of incentive for participants in the ecosystem. This model not only fosters network security by encouraging participation but also aligns the interests of hiBERO stakers and bribers alike with the success of Berachain.

An additional flywheel effect is kicked off by using a LSD of iBGT as the bonding curve base token. Using a Liquid Staking Derivative (LSD) as the base token for a bonding curve can significantly enhance the fees and liquidity flywheel in a DeFi ecosystem. Bonding curves, as automated market-making mechanisms, adjust the price of a token based on its supply. When the base token is an LSD, it inherently carries additional yield-generating properties from the staked assets. This integration attracts more participants, as it offers the dual benefits of liquidity provision and staking rewards. As more users engage, the increased demand on the bonding curve boosts the token's value, leading to higher transaction volumes. This surge in activity amplifies fee generation for liquidity providers, further incentivizing participation. Consequently, this creates a virtuous cycle: the liquidity and staking rewards attract more users, which in turn drives up transaction volumes and fees, thereby supercharging the overall liquidity and fee generation mechanism within the ecosystem.