TechFlow news, April 25 — According to Cointelegraph, Polygon Labs CEO Marc Boiron called for a fundamental shift in liquidity management among decentralized finance (DeFi) protocols. He stated that the current liquidity crisis in DeFi is "self-inflicted."
Boiron emphasized that DeFi protocols should stop offering high annual percentage yields (APY) through token emissions and instead adopt on-chain owned liquidity and transparent economic models. He noted that current high-yield strategies merely "rent liquidity," which quickly disappears once yields drop or token prices fluctuate.
Boiron expects increased institutional participation in the DeFi ecosystem within the next 12–18 months. He added that Polygon's POL token model will help protocols build stable capital pools, enabling them to focus on product development and user retention rather than continuously diluting token value to maintain liquidity.
