Swap impermanent loss

What Is Impermanent Loss? Impermanent loss describes the temporary loss of funds occasionally experienced by liquidity providers because of volatility in a trading pair . This also illustrates how much more money someone would have had if they simply held onto their assets instead of providing liquidity.

In the simplest terms, impermanent loss occurs when you deposit assets into a pool and suffer a loss when you withdraw them at a later date compared to just holding these assets throughout this period. As such, you don’t actually have to lose money for impermanent loss to occur .