# bdAMM

With the benefit of hindsight, we believe that liquidity mining has been an unsustainable tool for protocols to rent liquidity from their users. The most valuable users of a protocol are incentivized to farm rewards and immediately sell the tokens they mine.

As a result we wanted to build a token distribution mechanism that: 

* Rewards our most active borrowers and lenders
* Creates positive value for the protocol as a whole

As such, **dAMM** tokens will be distributed through a new mechanism we call, “Liquidity Bonding.” Liquidity Mining on **dAMM** does not pay out in the form of **dAMM** directly, but rather **bdAMM**. **bdAMM** can be redeemed 1:1 with **dAMM**, at a discount to the market price of **dAMM**.

* 75% of capital generated from bdAMM sales is restaked into dAMM Pools
* 25% is staked in the public insurance pool.