Impermanent Loss
By CoinGecko | Updated on Aug 12, 2021
Impermanent loss may occur when you provide liquidity to the AMMs. Impermanent loss is similar to measuring your opportunity cost of holding the token within the pools versus holding them in your wallet. Note: the loss is not realized until you remove your tokens from the liquidity pool. The higher the divergence between the value of holding your tokens in the pool and wallet, the higher is the impermanent loss.
Related Terms
ERC-20
ERC-20 is one of the most widely used token standards in Ethereum to create fungible, exchangeable tokens.
Internet of Things (IoT)
It is a system that lets any devices that are connected to internet to comunicate with each other without human-to-human or human-to-devices interactions.
Unspent Transaction Output
(abbv. "UTXO") Coins that are unspent in the wallet. UTXO virtually represents the cryptocurrency one own in the wallet.
Cold Storage
Offline storage of cryptocurrencies which is arguably safer as they also require physical access (eg. hardware wallet, paper wallets)
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