The Good Tech Companies - Why SegaSwap's $10M Seed Round Signals a Shift in Solana DeFi Incentive Models

Episode Date: September 23, 2025

This story was originally published on HackerNoon at: https://hackernoon.com/why-segaswaps-$10m-seed-round-signals-a-shift-in-solana-defi-incentive-models. SegaSwap raises seed funding at $10M valuation to build attention-based DeFi on Solana and Sonic SVM with liquid staking innovation. Check more stories related to web3 at: https://hackernoon.com/c/web3. You can also check exclusive content about #web3, #blockchain, #good-company, #sonic-svm, #segaswap, #defi, #cryptocurrency, #sonic-news, and more. This story was written by: @ishanpandey. Learn more about this writer by checking @ishanpandey's about page, and for more stories, please visit hackernoon.com. SegaSwap raises seed funding at $10M valuation to build attention-based DeFi on Solana and Sonic SVM with liquid staking innovation.

This audio is presented by Hacker Noon, where anyone can learn anything about any technology. Why Seagaswap's $10 million seed round signals a shift in Solana Defi incentive models by Ashan Pondi. Greater than can a decentralized exchange finally solve the mercenary capital problem that greater than has plagued Defi for years? Sega Swap thinks it has found the answer through a combination of liquid staking, tiered liquidity pools, and something called attention capital markets. The Seoul-based startup closed a seed round at a $10 million valuation on September 23, 2025, with Sonic SVM and 10K ventures leading the investment. The funding arrives as Sega Swap prepares to roll out what it describes as a fundamentally different approach to incentivizing liquidity providers on Solane and Sonic SVM.

The Mercenary Capital Challenge, every decentralized exchange faces the same dilemma. They need liquidity providers to deposit tokens into pools so traders, can swap assets. Without deep liquidity, trades suffer from high slippage, where users get worse prices than expected. To attract liquidity, protocols offer rewards, often in the form of their native tokens. The problem emerges when these rewards dry up. Liquidity providers, chasing the highest yields, immediately withdraw their funds and move to the next protocol offering better returns. This behavior, known as mercenary capital, creates unstable liquidity that disappears the moment incentives decline. Projects burn through Treasury funds trying to maintain competitive rewards,

only to watch their liquidity evaporate when a competitor offers slightly higher returns. Sega Swap believes it has engineered a solution through multiple interconnected mechanisms that change how liquidity gets rewarded and retained. The two-tier pool structure. Instead of treating all liquidity pools equally, Sega Swap divides them into two categories, main pools and attention Pools. Main Pools house established assets with proven track records. Attention Pools contain newer, more volatile tokens that carry higher risk. The distinction matters because of how fees get distributed. Attention Pools throughout a larger share of trading fees to liquidity providers, compensating them for taking on additional risk. A public leaderboard tracks trading volume

and total value locked, TVL, for each pool. When an attention pool demonstrates sustained activity and growth, it graduates to main pool status. This graduation system creates a transparent pathway for new projects to establish credibility. Rather than relying solely on token incentives to bootstrap liquidity, projects can prove their worth through actual trading activity and user engagement. The model encourages organic growth over artificial pumping through unsustainable rewards. Liquid staking as yield amplifier. Sega Sol, the protocol's liquid-staked Sol token, represents another piece of the puzzle. When users stake Sol through traditional methods, their tokens get locked up, unable to participate in other defy activities. Liquid staking changes this dynamic.

Users deposit Sol and receive Sega Sol in return. The deposited Sol continues earning staking rewards, currently around 7% annually on Solana. But unlike regular staked Sol, Sega Sol remains liquid. Users can trade it, provided AS liquidity, or use it in yield farms. This means the same capital earns multiple revenue streams simultaneously, base staking rewards plus whatever additional yields come from defy participation. Think of it like owning a rental property that generates monthly income while a simultaneously using that same property as collateral for a business loan. The capital works twice as hard. For liquidity providers, this dual

earning potential makes staying in pools more attractive even when additional token rewards decrease. Attention capital markets explained, the most experimental aspect of Segaswap's approach involves integration with Sonic SVM's attention capital market, ACM, protocol. In traditional finance, capital flows toward opportunities based on expected returns. In crypto, speculation and hype often drive these flows more than fundamentals. ACM attempts to quantify and reward genuine user attention and engagement. Instead of measuring success purely through TVL or trading volume, the protocol tracks sustained interaction patterns. A token that maintains consistent daily traders over months scores higher than one experiencing a brief spike follow Edby dormancy.

These attention metrics then determine reward distribution. Pools demonstrating real, sustained interest receive larger allocations. The goal shifts from creating temporary liquidity spikes to building lasting market presence. Projects cannot simply buy their way to the top through token emissions, they must cultivate actual user bases. The system creates feedback loops. Real usage generates attention scores, which trigger rewards, which deepen liquidity, which improves trading experience, which attracts more users. Unlike traditional yield farming where rewards often flow to passive capital, ACM directs incentives toward active participation. Technical implementation and roadmap. The seed funding enables several technical developments.

First, Sega Swap Planza implement deeper routing algorithms on Sonic SVM. When users trade, the protocol needs to find the most efficient path through various liquidity poolstow minimize price impact. Better routing means better prices for traders and more fee generation for liquidity providers. Second, the team aims to expand Sega Sol integrations across the ecosystem. Each new use case for the liquid staking token increases its utility and demand. The protocol also plans to introduce new pool types optimized for different asset classes, from stable coins to volatile mean coins. Third, Sega Swap will develop partner reward modules, allowing other projects to plug into the incentive system. Rather than each protocol

building its OWN liquidity mining program, they can leverage Segaswaps infrastructure and attention-based distribution model. Market context and competition, Sega Swap enters a crowded field. Solana already hosts established AMMs like Orca, Radium, and Jupiter. Each offers its own approach to attracting and retaining liquidity. Orca focuses on concentrated liquidity, allowing providers to earn higher fees by targeting specific price ranges. Radium integrates with Serum's order book for enhanced price discovery. Jupiter aggregates liquidity across multiple sources.

The timing proves interesting. Solana's ecosystem has matured significantly since the 2022 market downturn. Transaction costs remain low, typically under Ascent, while throughput continues improving. The network processes thousands of transactions per second without the congestion issues plaguing Ethereum during peak periods. Sonic SVM adds another dimension. As a Solana virtual machine implementation, IT promises even higher performance while maintaining compatibility with existing Solana programs. Projects building on Sonic SVM need liquidity infrastructure, creating opportunity for early movers, like Sega Swap. Chris Zhu, CEO of Sonic SVM, explains, greater than, we see Sega swap complementing Sonic SVM's focus on high throughput consumer greater than apps by routing attention and liquidity

where it's earned. Sega Sol and the greater than two-tier pool design give builders practical tools to bootstrap markets greater than without relying on short-term incentives. The phrase, where it's earned, stands out. Traditional Defi often rewards capital simply for showing up. Segas WAP's model demands proof of genuine market activity before rewards flow. Final thoughts. Sigaswap's approach addresses real problems in Defi, but execution will determine success. The two-tier pool structure makes logical sense, creating clear incentives for both new projects and established tokens. Liquid staking through Sega Sol offers tangible benefits over traditional staking, though competition from established providers like Marinate and Gita will prove fierce.

The attention-based reward system represents the biggest wildcard. Measuring genuine engagement versus manufactured activity remains challenging. Sophisticated actors might game attention metrics just as they currently farm yields. The protocol's ability to distinguish real usage from artificial pumping will determine whether ACM delivers on its promise. The $10 million valuation seems reasonable given the early stage and experimental nature of the project. investors appear to be betting on the team's ability to execute rather than current traction. With Sonic SVM still in development and Sagaswap's main at presence limited, much depends on future delivery.

For Solana users, Sega Swap offers another option in an increasingly diverse Defy landscape. Whether it can differentiate sufficiently from established competitors remains uncertain. The protocol success likely depends less on revolutionary technology and more on consistent execution and community building. In Defi, the best technology rarely wins alone. The winners combine solid infrastructure with strong incentives and active user communities. Sega Swap has proposed interesting solutions, but the market will ultimately judge their effectiveness. Don't forget to like and share the story. Thank you for listening to this Hackernoon story, read by artificial intelligence.

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