# Liquidity Pools

When you add your token to a Liquidity Pool you will receive Liquidity Provider (LP) tokens and share in the fees.

# LP Tokens

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

The number of LP tokens you receive represents your portion of the VERTO-REBUS Liquidity Pool.

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

Liquidity Pool Existing Pools
Liquidity Pool Existing Pools
Liquidity Pool Add Liquidity
Liquidity Pool Add Liquidity

# Liquidity Providers earn trading fees

Providing liquidity gives you a reward in the form of trading fees when people use your liquidity pool.

Whenever someone trades on VertoTrade, the trader pays a 0.25% fee, of which 0.17% is added to the Liquidity Pool of the swap pair they traded on.

For example:

  • There are 10 LP tokens representing 10 VERTO and 10 REBUS tokens.
  • 1 LP token = 1 VERTO + 1 REBUS
  • Someone trades 10 VERTO for 10 REBUS.
  • Someone else trades 10 REBUS for 10 VERTO.
  • The VERTO/REBUS liquidity pool now has 10.017 VERTO and 10.017 REBUS.
  • Each LP token is now worth 1.00017 VERTO + 1.00017 REBUS.

To make being a liquidity provider even more worth your while, you can also put your LP tokens to work whipping up some fresh yield on the VERTO Farms, while still gaining your 0.17% trading fee reward.

# Impermanent Loss

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

“Simply put, impermanent loss is the difference between holding tokens in an AMM and holding them in your wallet.” - Nate Hindman