Liquidity Pools

Exchange V3

In the Exchange V3, liquidity will be managed in the form of a non-fungible position. You will still earn a share in the fees while providing liquidity.

When you add your token to a Liquidity Pool you will receive a Liquidity Provider NFT token and share in the fees.

Non-fungible liquidity positions

In V3, liquidity providers have more control over what price range they want to deploy their liquidity. So, when you add your token to a Liquidity Pool in V3, you will create a new non-fungible liquidity position with its unique settings.

Therefore, in V3, liquidity positions are NFTs. Please note that these NFTs are transferable, and they represent the ownership of the underlying assets and the trading fees they earned.

In V3, trading fees will no longer be automatically compounded in the position. You can manually claim them on each of the position detail pages.

You can redeem your funds at any time by removing your liquidity.

Active liquidity and price ranges

In V3, liquidity providers can configure their positions to only provide liquidity when the price is within a certain range. If the trading price moves out of the range, the position will consist of only one type of token in the pair and become inactive.

Inactive liquidity positions will not participate in trading or earn any trading fees.

Concentrated liquidity

In V3, because of liquidity providers can concentrate their token deposits to provide liquidity only within a specific price range. With the same amount of underlying assets, V3 can support a much bigger trade.

It results in a much higher relative liquidity level when compared to V2. Liquidity providers can earn more trading fees with the same amount of capital.

Earning TP

To make being a liquidity provider even more worthwhile, you can also put your liquidity positions to work inside of the TP Farms, while still earning the base trading fee rewards.

Exchange V2

LP Tokens

As an example, if you deposited TP and CAMP into a Liquidity Pool, you'd receive TP-CAMP LP tokens.

The number of LP tokens you receive represents your portion of the TP-CAMP Liquidity Pool.

You can also redeem your funds at any time by removing your liquidity.

Earning trading fees

Whenever someone trades on Trading Post, for each hop (swap) in each Exchange V2 liquidity pool, the trader pays a fixed 0.25% fee.

Earning TP

Similar to Echange V3, you will be able to deposit some of the LP tokens into farms to earn additional TP on top of the base trading fees.

Impermanent Loss

Providing liquidity is not without risk, as you may be exposed to impermanent loss.