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
Blockchain
In Bitcoin's case, blockchain describes its decentralized, public ledger which contains transactional information.
Yield Farming
Yield farming involves putting cryptocurrency into a DeFi protocol to collect interest on trading fees.
Limit Order / Limit Buy / Limit Sell
Orders placed by traders to buy or sell a cryptocurrency when a certain price is reached
Trading Volume
The amount of the cryptocurrency that has been traded in the last 24 hours.
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