berachain Expands proof-of-Liquidity System to Boost Decentralized Applications
Berachain is advancing its proof-of-liquidity (PoL) system. This move will extend governance and rewards beyond its native BEX pools. Previously, only BEX was used for distributing rewards. Now, other decentralized applications can apply for incentives through new reward vaults, starting March 24.
According to Berachain’s declaration,this change will help projects grow by attracting more liquidity. The initial set of vaults includes liquidity pools from various decentralized finance platforms.This system offers more transparency and user control over incentive allocation.
berachain’s PoL model keeps assets active in DeFi, unlike customary proof-of-stake systems where tokens are locked for security. This ensures network activity remains high. Validators must return some rewards to the network, supporting projects that boost activity.
The governance token, BGT, allows holders to vote on which validators and projects receive support. The first approved vaults focus on DEX liquidity pools, chosen for their liquidity, security, and importance. These include pools on BEX, Kodiak, and Beradrome, featuring assets like BERA, HONEY, and BGT.
Since launching its mainnet on February 6, Berachain has seen rapid growth. It now holds $3.1 billion in total value locked and nearly $1 billion in circulating stablecoins. Trading volume in February reached $1.9 billion. The new governance initiative aims to attract more users and further grow the blockchain.
