The liquidity pool powers a marketplace where anyone can lend or borrow tokens . The usage of these marketplace incurs fees from the users, and the fees are used to pay liquidity providers for staking their own tokens in the pool. Most yield farming takes place on the ethereum platform.
Read moreHow do liquidity pools work?
A liquidity pool can be thought of as a pot of cryptocurrency assets locked within a smart contract, which can be used for exchanges, loans and other applications . In traditional finance (Centralised Finance or CeFi), liquidity is provided by a central organisation, such as a bank or a stock exchange.16 Ara 2021
Read moreWhat is liquidity pool in cryptocurrency?
A liquidity pool refers to a pool of tokens that are locked in a smart contract, which is a self-executing program based on the agreements between the buyer and seller . The pool enables cryptocurrency trading by providing users with liquidity. Liquidity refers to the ease with which a token can be swapped with another.26 Oca 2022
Read moreWhat is a pool of liquidity?
Summary. A liquidity pool is a crowdsourced pool of cryptocurrencies or tokens locked in a smart contract that is used to facilitate trades between the assets on a decentralized exchange (DEX) .
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