🔹
Providing liquidity normally
AMM exchanges rely on liquidity providers: users like you who provide their assets to the pool. Liquidity providers are often just called LPs for short.
Each swap pays a certain amount of commission to the liquidity providers (and a small amount to Zircon).
So liquidity providers can earn a pretty significant yield just by holding assets like ETH and USDC and supplying them to the AMM.
Sounds too good to be true? There is one major risk: impermanent loss.
Last modified 6mo ago