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Yield Farming

Paragon Farms allow users to earn rewards by providing liquidity and staking LP tokens. Farming combines trading activity, emissions, and execution-based incentives into a unified reward system.

What You Earn

When farming on Paragon, rewards come from three sources:


1. LP Trading Fees

Every swap generates a fee:

  • 0.20% base fee

  • 0.17% → LPs

  • 0.03% → Protocol (POL / treasury)

👉 You earn:

  • proportional to your share of the pool

  • continuously as trades occur


2. Farm Rewards (XPGN Emissions)

Paragon distributes XPGN emissions to active farms.

Key points:

  • emissions are focused on core pools (e.g. XPGN / USDT)

  • rewards are distributed to liquidity providers

  • emission direction is controlled by veXPGN governance

📌 See Tokenomics for full emission details


3. Execution-Based Rewards

When trades are routed through Paragon’s execution layer, pools used in routing may receive additional rewards.

👉 Key points:

  • rewards depend on actual usage

  • not all trades generate additional rewards

  • varies based on execution conditions

📌 See Surplus & Rebates for full mechanics


The Paragon Yield Model

Paragon separates value into three layers:


🌱 Emissions (Growth)

  • XPGN distributed to farms

  • incentivizes liquidity and participation


💸 Fees (Value Capture)

  • protocol share of trading fees

  • used for buybacks and Protocol-Owned Liquidity


⚡ Execution (Efficiency)

  • improved routing can generate additional value

  • shared across participants


👉 Result:

A system combining growth, sustainability, and activity-driven rewards.


Example (Simplified)

You provide liquidity to XPGN / USDT.

You may earn:

  • LP trading fees

  • XPGN farm rewards

  • additional rewards when your pool is used in execution


⚠️ Impermanent Loss (IL)

Liquidity providers may experience Impermanent Loss:

  • caused by price divergence between tokens

  • may reduce value compared to holding assets separately


Offset by:

  • trading fees

  • emissions

  • additional rewards (when applicable)


How Rewards Are Paid

LP Fees

  • accumulate in the pool

  • realized when liquidity is removed


XPGN Emissions

  • distributed continuously

  • claimable via the Farms interface


Execution-Based Rewards

  • generated based on routing usage

  • claimable depending on implementation


veXPGN (Governance Layer)

Locking XPGN into veXPGN allows users to:

  • influence emissions

  • participate in governance

  • align with long-term protocol growth

📌 See veXPGN (Locking & Power) for details


Current Parameters

  • base fee: 0.20%

  • LP share: 0.17%

  • protocol share: 0.03%

  • emissions: focused on core pools


⚠️ Risks

  • Impermanent Loss

  • variable APR (depends on volume and emissions)

  • emissions may change via governance

  • execution-based rewards depend on usage


FAQ

Where do emissions go? → Core farms and ecosystem incentives


Are fees distributed as rewards? → LPs earn trading fees; protocol share is used for treasury functions


Can I unstake anytime? → Yes, unless a specific pool defines additional conditions


Summary

Paragon Farming combines:

  • trading fees

  • emissions

  • execution-based incentives

It is designed to align rewards with actual protocol activity rather than relying solely on inflation.

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