Polygon CEO Marc Boiron: DeFi Must Abandon Hype and Embrace Sustainable Liquidity

Polygon Labs CEO Marc Boiron is urging decentralized finance (DeFi) protocols to shift their focus from short-term incentives to long-term sustainability. In a candid interview, Boiron called DeFi’s persistent liquidity problems “self-inflicted,” and outlined a strategy rooted in chain-owned liquidity, transparent treasury management, and economic discipline.

Mercenary Capital: The Pitfall of High APYs

Boiron criticized the widespread practice among DeFi protocols of offering excessively high Annual Percentage Yields (APYs) to attract liquidity, saying these incentives often draw “mercenary capital” — funds that vanish the moment yields decline or token prices dip.

“It’s just renting liquidity; it’s not real loyalty,” Boiron stated. “These strategies might inflate numbers in the short term, but they erode trust and dilute token value in the long run.”

This over-reliance on token emissions to fuel liquidity results in a fragile foundation for protocols, undermining the kind of resilience and predictability needed to attract institutional capital.

A Path Toward Sustainable DeFi

To address the issue, Boiron is championing a vision for sustainable DeFi, centered around owned liquidity and protocol-native financial models. He highlighted Polygon’s POL token as a key tool in this transformation.

“Sustainable DeFi needs models where liquidity sticks around for the right reasons,” he said. “That means putting protocol treasuries to work rather than burning capital on temporary liquidity providers.”

Boiron’s strategy encourages projects to build long-term liquidity positions using captured fees, bonding mechanisms, and strategic emissions rather than just reacting to market hype. This approach, while slower, allows protocols to retain value, strengthen treasuries, and reduce dependence on speculative capital.

Building a DeFi Foundation for TradFi Integration

A sustainable liquidity model, Boiron argues, is critical for onboarding traditional finance (TradFi) into DeFi. Institutional players require stability, predictable access to liquidity, and low slippage — qualities that hype-driven protocols typically lack.

“If a DeFi protocol suddenly loses liquidity or slippage spikes, it creates a level of risk most institutions just won’t take,” Boiron explained.

By implementing chain-owned liquidity models, Polygon aims to offer financial primitives that mirror the reliability and transparency that institutions expect, creating a bridge between DeFi and TradFi without compromising decentralization.

Looking Ahead: Chain-Owned Liquidity as a DeFi Standard

Boiron envisions a more robust and disciplined DeFi landscape by 2026, marked by:

Less volatility

Greater community governance

Mature integrations with real-world assets

He believes POL will play a foundational role in this transition, enabling protocols to reduce emissions, retain users, and improve product quality without constantly fighting to fill liquidity gaps.

“POL doesn’t solve everything, but it gives protocols the breathing room to focus on real innovation,” he said. “The protocols that survived past market cycles were the ones that embraced sustainable economics.”

Boiron also expressed confidence that regulatory clarity, especially from frameworks like Europe’s MiCA and evolving U.S. guidelines, will accelerate institutional participation in the next 12–18 months. He remains optimistic that more DeFi teams are starting to understand the value of long-term thinking.