I agree with @monet-supply that we should focus on supply side for providing markets and to avoid so called wash borrowing. Similarly as @ashwathbk mentioned as well, we should avoid the scenario where “fast food” farmers are farming for short-term gains by selling their crops for cashflow.
Governance tokens are not cashflow and incentives should be aligned to the direction that liquidity providers are incentivized to stake whatever they are earning back to the network to provide security. This actually provides also additional yield for the liquidity providers and they become network security participants. Participants who are participating in securing the network might have higher risk awareness and value protocol health more than liquidity providers that are looking for short term gains.
There are no shortage of liquidity providers in DeFi and dedication to provide long-term liquidity should be rewarded, without limiting composability. Rewarding long-term LPs would democratise also earnings since gas costs eats the yields of smaller LPs and smaller LPs might be less keen on optimizing their yields in DeFi, rather they want to park their funds to a safe harbour that yields better than their fiat equivalents.