BOLD's Struggling Supply Growth Sparks Calls for Public Infrastructure Upgrade

Liquity Protocol's v2 stablecoin, BOLD, has a distinct monetary foundation thanks to its innovative Protocol Incentivized Liquidity (PIL) mechanism. This setup dedicates 25% of v2's protocol revenue as a perpetual liquidity budget for BOLD.

However, despite its unique features as a decentralized and immutable stablecoin, also known as The Ethereum Dollar, BOLD's supply growth has stagnated. A major reason for this is the insufficiency of the protocol's in-built redemption mechanism to reduce circulating BOLD supply when it trades below $1.

This mechanism can help BOLD return to its price peg, but users are increasingly wary of redemption risks due to its limitations.