# Background

Liquidity mining has been a widely used method to bootstrap liquidity for DEXs and lending protocols. In this approach, protocols offer token incentives to individuals who provide liquidity. However, this incentivized liquidity is often short-lived, with farmers quickly selling off the reward tokens.

Why wouldn’t they? It’s *free* money.

The interests of these farmers often clash with those of token holders. Farmers benefit at the expense of token holders. Once the token incentives decrease or end, farmers withdraw their liquidity, leaving the protocol depleted and causing the token’s price to plummet. It’s evident that traditional liquidity mining is not sustainable for the long-term growth of such protocols.

### Objectives of FOO Tokenomics <a href="#objectives-of-foo-tokenomics" id="objectives-of-foo-tokenomics"></a>

The Fungible Ownership Optimization (FOO) system in A51 Finance aims to address these challenges by achieving **four** key objectives:

1. **Incentivize Liquidity**: This fundamental goal is accomplished through traditional liquidity mining techniques.
2. **Disincentivize Mercenary Farming**: The system seeks to minimize farming-and-dumping behaviors.
3. **Ensure High Liquidity for the Token**: This reduces the token’s price volatility and enables higher incentivized total value locked (TVL).
4. **No Excessive Inflation:** 50% of inflation is offset by new value coming into the system in the form of $A51 sales.

FOO aligns the interests of farmers, token holders, and liquidity providers, creating a more sustainable and beneficial ecosystem for all stakeholders involved.

### FOO Starting Point: The Gauge System <a href="#id-1311" id="id-1311"></a>

Similar to Curve’s veTokenomics, the Gauge System in FOO incentivizes liquidity in the following manner:

1. There is a continuous stream of reward tokens.
2. These reward tokens are distributed across different liquidity pools.
3. Voters vote on pools where they want the reward emission.


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