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Yield Farming

Earning fees — and the risks nobody advertises

Providing liquidity means depositing two assets into a pool so others can trade against them. You earn a share of trading fees, and you take on risks that are easy to miss.

How an AMM pool pays you

Every swap pays a trading fee to the pool. Your LP tokens represent your share of the pool, so the pool grows and your share is worth more when you withdraw.

Impermanent loss, in plain English

If the two assets move apart in price, the pool automatically sells the winner and buys the loser. Withdraw at that moment and you hold less value than if you had simply kept both assets. A 2x price move costs roughly 5.7%; a 4x move costs about 20%.

The risks that actually wipe people out

Impermanent loss is survivable. An issuer minting unlimited supply, clawing tokens back, freezing your position, or a single whale pulling all the liquidity is not.

  • Check whether the issuer account is blackholed.
  • Check whether clawback or freeze is enabled.
  • Check how concentrated the LP holders are.

Where liquidity pools live

AMM pools are native XRPL objects — these platforms let you view, join and monitor them. Always check issuer safety before depositing.

Listed for education only — not endorsements or financial advice. Always verify a site's URL and an issuer's address on an explorer before connecting a wallet.

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