What TVL will my incentives attract? It’s one of the most common questions we get from @merkl_xyz clients. The honest answer is that it depends on market conditions and many other factors. Your cost of liquidity is relative. It depends on: - What others do: how much the protocols around you pay for the same liquidity - The underlying asset: USDC, ETH and BTC don’t behave the same way. BTC liquidity is usually the cheapest because its opportunity cost is lower - The type of opportunity: incentivizing lending isn’t the same as incentivizing a concentrated liquidity pool, where LPs take on more risk - Your distribution: the more people see your incentives, the better. That’s why being on Merkl usually gets you the lowest cost of capital: it reaches more qualified LPs than anyone else in DeFi