Decentralized Finance (DeFi) continues to redefine how users interact with digital assets, and Avalanche has emerged as one of the most promising ecosystems for high-speed, low-cost financial applications. Among its growing suite of DeFi platforms, Pangolin stands out as a leading decentralized exchange (DEX) built specifically for the Avalanche network.
In this guide, we’ll walk you through everything you need to know about liquidity mining on Pangolin — from understanding its native token $PNG to step-by-step instructions for earning passive income by providing liquidity. Whether you're new to DeFi or expanding your strategies across chains, this tutorial will help you get started securely and efficiently.
What Is Pangolin?
Pangolin is a decentralized exchange (DEX) operating on the Avalanche blockchain, designed as a fork of Uniswap but optimized for Avalanche’s high throughput and near-zero transaction fees. Like other automated market makers (AMMs), Pangolin enables users to trade tokens directly from their wallets without intermediaries.
The platform runs on a community-driven model, meaning there's no centralized team controlling upgrades or treasury allocations. Instead, governance is in the hands of $PNG token holders, who vote on proposals affecting the protocol’s future.
One of Pangolin’s standout features is its fair launch mechanism — a core principle that resonates strongly within the DeFi community. Unlike many projects that allocate large portions of tokens to insiders or investors, Pangolin distributed all $PNG tokens fairly among liquidity providers and early adopters.
Understanding the $PNG Token
$PNG is the native governance and utility token of the Pangolin protocol. With a total supply capped at 538 million tokens, its distribution reflects a strong commitment to decentralization:
- 95% (512 million $PNG): Allocated to the community via liquidity mining rewards
- 5% (26 million $PNG): Reserved for community airdrops
Notably, no tokens were allocated to founders, developers, or private investors, reinforcing its fair-launch credentials.
Token Emission Schedule
Pangolin follows a halving-style emission schedule to ensure long-term sustainability:
- First 4 years: 256 million $PNG distributed (~175,342 $PNG per day)
- Next 4 years: Emissions halved to 128 million
- This pattern continues every four years, reducing rewards by 50% each cycle
This means early liquidity providers earn significantly higher returns — an incentive designed to bootstrap initial liquidity and user adoption.
Holding $PNG grants users voting rights in governance proposals, such as listing new token pairs, adjusting reward distributions, or integrating new features into the platform.
Why Choose Pangolin for Liquidity Mining?
When evaluating DeFi opportunities, three factors stand out: speed, cost, and control. Pangolin excels in all three:
- Fast Transactions: Avalanche processes transactions in under one second.
- Low Fees: Gas costs are fractions of a cent compared to Ethereum.
- Community-Owned: Fully governed by $PNG stakers — no corporate entity controls the protocol.
Additionally, because DEXs like Pangolin provide essential liquidity to emerging projects on Avalanche, participating in liquidity mining helps strengthen the entire ecosystem while generating yield.
Step-by-Step Guide: How to Start Liquidity Mining on Pangolin
Ready to begin? Follow these steps to start earning $PNG rewards today.
Step 1: Choose Your Liquidity Pool
Liquidity pools come in various token pairs. For this example, we'll use the AVAX/USDT pair — two of the most stable and widely used assets on Avalanche.
Ensure you have both AVAX and USDT ready in your wallet (e.g., MetaMask). Most pools require a 50/50 value ratio of each asset.
👉 Learn how to bridge assets to Avalanche and manage multi-chain portfolios efficiently.
Step 2: Swap Tokens if Needed
If you don’t already hold USDT, use Pangolin’s swap function to convert part of your AVAX into USDT. Navigate to the “Swap” tab, enter the amount, and confirm the transaction.
Always leave some AVAX in your wallet to cover gas fees on the C-Chain (Avalanche’s smart contract chain).
Step 3: Add Liquidity and Receive LP Tokens
Go to the “Pools” section and select the AVAX-USDT pair. Click “Add Liquidity” and input the amount you’d like to contribute.
After approving both tokens (a one-time process), confirm the transaction. Once complete, you’ll receive LP (Liquidity Provider) tokens — proof of your share in the pool.
These tokens represent your proportional ownership and entitle you to a share of trading fees generated by the pool.
Step 4: Stake LP Tokens in the Farm
Now that you have LP tokens, head over to the “Farms” tab. Find the AVAX-USDT farm and click “Deposit.” Enter your desired amount and confirm.
You’re now officially farming $PNG! The dashboard will display your estimated weekly earnings based on current APY and pool size.
Step 5: Monitor and Withdraw Rewards
You can claim your $PNG rewards at any time without unstaking. However, if you decide to exit:
- Unstake your LP tokens
- Remove liquidity to get back your original AVAX and USDT
- Be aware of impermanent loss if prices have shifted significantly
Always review projected returns, impermanent loss risks, and gas costs before committing funds.
Core Keywords for SEO & User Search Intent
To align with common search queries and improve discoverability, here are key terms naturally integrated throughout this guide:
- Avalanche DeFi
- Pangolin liquidity mining
- $PNG token
- AVAX USDT pool
- How to farm on Pangolin
- Decentralized exchange Avalanche
- Fair launch crypto
- Low fee DeFi platform
These keywords reflect high-intent searches from users exploring yield opportunities on Avalanche and seeking reliable entry points into DeFi.
Frequently Asked Questions (FAQ)
Q: Is Pangolin safe to use?
A: Yes, Pangolin is an open-source, audited protocol with no central authority. However, always verify contract addresses and beware of phishing sites. Use only the official pangolin.exchange domain.
Q: What is impermanent loss?
A: Impermanent loss occurs when the price of deposited tokens changes relative to each other. The greater the volatility, the higher the potential loss — though trading fees and $PNG rewards can offset it over time.
Q: Can I stake $PNG directly?
A: Yes! Besides liquidity farming, Pangolin offers single-token staking pools where you can stake $PNG directly and earn additional protocol rewards or partner tokens.
Q: How often are $PNG rewards distributed?
A: Rewards accrue in real-time and can be claimed at any time through the Farms interface.
Q: Does Pangolin support Ethereum?
A: While primarily on Avalanche, Pangolin also operates on Ethereum for cross-chain interoperability. However, most activity and best yields are on Avalanche due to lower costs.
Q: Are there alternatives to Pangolin on Avalanche?
A: Yes — platforms like Trader Joe and YetiSwap also offer liquidity farming. But Pangolin remains popular for its simplicity, transparency, and strong community focus.
Final Thoughts: DeFi Rewards Are Driving Growth on Avalanche
Despite having a smaller total value locked (TVL) compared to giants like Ethereum or BNB Chain, Avalanche is rapidly gaining traction thanks to its technical advantages and attractive DeFi incentives.
Pangolin plays a crucial role in this growth by enabling permissionless trading and rewarding contributors fairly. As more users discover the benefits of fast settlements and minimal fees, participation in liquidity mining is expected to rise.
By getting involved now, you're not only earning yield — you're helping shape a decentralized financial system built on fairness and accessibility.
👉 Start exploring top-performing DeFi protocols with advanced tools and secure access today.