Protocol-Owned Liquidity

A DeFi model where protocols own their own trading liquidity instead of renting it from liquidity providers through token emission incentives. Pioneered by OlympusDAO in 2021, POL uses bonding mechanisms to acquire LP tokens from users at a discount. This gives protocols permanent liquidity that does not disappear when incentives dry up, solving the mercenary capital problem that plagued early DeFi liquidity mining.