Liquidity mining is relatively new in crypto and is a community-focused token distribution strategy. The basic idea here is that token holders provide capital to a project, by becoming Liquidity Providers (LPs), in return for its native token. Liquidity mining allows a fair and wide distribution of tokens instead of concentrating ownership in the hands of early investors. Token ownership tends to encourage high community participation and engagement, which is crucial to building a successful DAO. From a project’s perspective, liquidity mining provides deep and stable liquidity for a token while facilitating lower slippage and a better trading experience.