Reya’s Liquidity Generation Event Attracts $100 Million In Less Than 24 Hours

Reya, a modular Layer 2 network optimized for trading applications, is the latest web3 project to drive impressive growth off the back of a points campaign for early adopters.

Reya announced the launch of its “Liquidity Generation Event” (LGE) on April 22, offering boosted points to users who provide assets to the network during the two weeks leading up to the launch of the Reya Perps decentralized exchange.

Reya attracted more than $100 million within 18 hours, with the protocol’s total value locked (TVL) currently sitting at $167.6 million around 40 hours later.

“The Liquidity Generation Event (LGE) is live and accessible via the Reya dApp, allowing early supporters to stake capital into the Network,” Reya said in a blog post. “This bootstrapping event will kickstart the interoperable liquidity flywheel for future DEXes.”

Reya exclusively supports deposits in the form of USDC during its LGE.

Shared liquidity

The Reya team first teased the project on social media in December. In March, the team announced the completion of a $10 million funding round that attracted backing from major web3 investors including Coinbase Ventures, Framework Ventures, and Wintermute in a now-deleted tweet.

The project bills itself as a “trading-optimized Layer 2” built on top of Arbitrum’s Orbit tech stack via Gelato’s rollup-as-a-service platform. Reya claims a maximum throughput of 30,000 transactions per second and block times of just 100 milliseconds while boasting a gas-free network architecture to prevent MEV and transaction front-running.

However, the team emphasizes the provision of shared network liquidity to native DEXes as the primary point of difference between Reya and rival L2s.

“The one thing which we really focus on is interoperable liquidity, meaning that the network itself actually provides liquidity through to the DEXes that build on the network,” said Simon Jones, the co-founder and CEO of Reya Labs, during an April 23 stream hosted by Arbitrum. “The way that works is users basically stake capital into the network, that capital gets passed through a passive LP pool, and then gets made available to all of the DEXes on Reya.”

Jones said Reya’s interoperable liquidity mechanism prevents capital fragmentation on the network, deepening markets and improving trading conditions.

“We believe that generalizable L2 can’t scale DeFi,” Jones said in a recent blog post. “Reya Network is optimized for DeFi trading only, meaning we’re able to improve performance and add a novel liquidity design into the network, creating the best network for DEXes to build on.”

Churro, a community manager at OffChain Labs, the team behind Arbitrum, described Reya as “a crowning achievement to what DeFi on Orbit chains can achieve.”

However, Reya is not the only network aiming to provide shared liquidity within its ecosystem. On April 10, Layer N, an execution environment for Layer 2 appchains, announced the launch of its testnet deployment.

Layer N said it hopes to become the execution layer for “thousands of hyper-optimized rollups” enjoying shared liquidity while also maintaining a single user interface.