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
Emission
The speed/rate at which new coins are minted and released as dictated by the protocols written.
Validator
A block-signing participant of a Proof of Stake blockchain network, whom have significant tokens staked on the network.
Permissioned Blockchain
It is a private blockchain where the nodes must be previously authorized by a central entity.
Decryption
The process of decrypting data that was previously encrypted (made unreable) back to a readable form.
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