Add Liquidity

Adding Liquidity to the pool allows Liquidity Providers to earn interest on their assets. Anyone can provide liquidity to DerpDEX for any supported token pool. To add liquidity, you can click to the below link to get started.

To add liquidity, you should have any two supported tokens and some ETH to pay the gas fees. Below are the steps to add liquidity to the DerpDEX pool and earn interest on your assets.

  1. Open the Pool page on DerpDEX and click on Add Liquidity.

  2. Select the token pair on the Add Liquidity page.

  3. Selecting fee tier - the best fee tier is selected automatically based on the pair.

NOTE: If the Tokens are not approved/signed by the user, they have to approve them separately first. For below pool, the user have to Approve WBTC and Approve USDC by signing a transaction from your wallet. This will allow user to spend of USDC and WBTC without approving the spending limit everytime.

After clicking on Approve WBTC or Approve USDC, Wallet will popup to sign the transaction.

Similarly approve spending limit for USDC.

  1. Now you can put the value of any one token that you want to provide to the pool, the amount of other token will be calculated automatically. DerpDEX also provides option to customize liquidity to be provided by the user. a. DerpDEX currently supports four fee tiers and it will automatically be selected based on the crypto pair selected. The fee tier defines how much fee will be collected by the pool if it's used by any of the trade.

b. The range of liquidity can be customised by the user, they can provide liquidity to only selected range which help the user to get leverage by proving less amount of tokens and still earning higher returns if the token are traded between the range. This allows degens to get max out of their token and don't risk their whole token allocation for full range of price. For example, USDC-DAI pool is usually traded between 0.98 to 1.01 and they remain stable. So, a user can only provide liquidity for this smaller range rather than full range as only some part of it will be used. 1. Active Liquidity refers to the range of current market price. 2. Conservative Liquidity uses a wider range than Active Liquidity. 3. Full Range allows to add liquidity for price between 0 to Infinity. 4. With Custom, user can select the range as per their analysis and earn based on their calculations.

Click on Preview button once the amount of tokens are selected to view all the details for adding tokens to the pool.

  1. Make sure everything is correct in the Transaction Preview and click on Confirm to add liquidity.

  2. Your wallet will popup once Confirm button is clicked, now confirm the transaction on your wallet and the liquidity will be added to the pool.

  3. Once transaction is completed, a Success screen will be shown to the user. User can also check about the transaction on the explorer by clicking the View on Explorer button.

  4. You can check your liquidity on the DerpDEX Pool page.

Now Liquidity is added to DerpDEX, the user will get some part of fee spent by DEX users for every swap. The fee is collected automatically and distributed to Pool Providers. You don't need to touch the pool anytime and can withdraw any amount from the pool without any restrictions.

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