Points
Off-chain loyalty units distributed by protocols, often convertible to tokens in future airdrops.
In-Depth Explanation
Points emerged as a pre-token incentive mechanism. Protocols award points for deposits, trading, referrals—anything they want to encourage. Points signal future airdrop eligibility without committing to token amounts. The system creates engagement but also speculation: points trade on secondary markets despite uncertain conversion rates. Critics note points let protocols extract TVL without guaranteed compensation.
Related Terms
Airdrop
Free distribution of tokens to wallet addresses, typically to reward early users or generate awareness.
Liquidity Mining
Earning token rewards by providing liquidity to a DeFi protocol.
Mercenary Capital
Capital that moves between protocols purely to chase the highest incentives, with no loyalty or long-term commitment.
More in Yield
View all →Mercenary Capital
Capital that moves between protocols purely to chase the highest incentives, with no loyalty or long-term commitment.
Annual Percentage Yield
APYThe annualized return on an investment accounting for compound interest.
Annual Percentage Rate
APRThe annualized return on an investment without accounting for compounding.
Real Yield
Yield derived from actual protocol revenue and economic activity, not token emissions or inflation.