I am a noone and I am already assuming this will be completely ignored, in any case, I will share some thoughts with you all and it would be much appreciated if I had some feedback.
I had an Idea, instead of giving incentives to private liquidity providers, a public account owned by the protocol itself could provide liquidity to a asset pair, be it tzBtc kUSD or others.
This is how it would work:
Of the 2.5tez minted every block, half is sold for tzBTC and the other half is added to the liquidity pool together with the freshly bought btc.
The trading fees go to the pool and this way it keeps growing.
Since there are no private actors that can withdraw the liquidity, liquidity will only increase.
Then it would be great if we could use the liquidity in the pool to fund development using a dao and voting over different funding proposals, otherwise there would be an ever increasing pool of liquidity with no owner.
This has the clear downside of growing the liquidity very slowly while the LB proposed in Granada would jumpstart the liquidity instantly.
The upside I see on my Idea is that the subsidy does not have to be continuous, even with only two years of subsidy there would be already around 1M of tez + 1k BTC or the equivalent in other assets and noone can withdraw it.
I know I might sound amateur but please do me a favor and tell me why it is a bad idea. Thank you