Let's talk about $BERA

Two things.

First, $BERA has reached 4.4 again, which indicates a sustained upward trend. This is considered a key position. The rise from last night to now is related to @SmokeyTheBera's announcement of Pol v1.1.

It is equivalent to pushing the price of $BERA to this key position 'reasonably' through news impact.

Second, Pol v1.1 is a very critical proposal. It aims to solve some issues encountered by Berachain after launching the mainnet, such as the weak value capture ability of $BERA, etc.

How does it do this?

It actually converts 20% of the ecological bribes into $BERA, while the amount of $BGT incentives given to the ecosystem will not be affected. Berachain will add the acquired $BERA to the LPs of mainstream trading pairs like BERA-HONEY and BERA-WBTC.

In the future, this 20% fee rate will become a dynamic fee rate, pricing according to incentive efficiency—higher efficiency leads to lower fees.

It essentially transforms part of the bribes into liquidity owned by the protocol (also known as PoL). This liquidity will generate fee income for Berachain, reducing the circulation of $BERA in the secondary market. This income will also be used to repurchase $BERA.

This model of 'protocol asset accumulation + self-sustaining model' optimizes traditional DeFi liquidity mining.

On the downside, the bribes that $BGT can capture have decreased—after all, part of it flows to the Berachain protocol, so the yield of @InfraredFinance's iBGT will decrease. Therefore, the exchange rate of iBGT to BERA will drop.

However, if $BERA appreciates, iBGT will still rise. For those who hold U-based assets, this is acceptable, but for investors who hold BERA/iBGT coin-based assets, it is not as friendly.

In summary, I am quite satisfied with this update from Berachain. They have recognized previous issues and made corresponding adjustments—weakening $BGT to enhance $BERA. As the price of $BERA rises, ecological incentives will increase, and the bribes for BGT will also increase.

Using the value capture ability of $BERA as the ecological driver is a very correct choice.