Liquidity
Providing liquidity on Monark is your opportunity to help power the decentralized trading ecosystem, while also earning rewards. In Monark’s v4 AMM DEX, liquidity pools are the foundation of every transaction—ensuring that trades are executed efficiently and securely.
What Are Liquidity Pools?
Liquidity pools on Monark are crucial to decentralized trading. These pools consist of pairs of tokens that users deposit to ensure there's always liquidity available for traders. Think of them as a dynamic financial engine—fueling every trade on Monark’s secure and advanced v4 AMM infrastructure.
When you add liquidity, you receive tokens representing your share of the pool. These tokens act as your claim, allowing you to withdraw your contribution whenever you want, and enabling you to participate in the earnings generated from the trading activity within the pool.
How to Provide Liquidity on Monark
Whether you’re an experienced DeFi participant or new to the space, the process is intuitive and quick:
Visit the Liquidity Page: Head to the Liquidity section within the Monark platform.
Add Liquidity: Click "Add Liquidity" to begin the process.
Select Your Token Pair: Choose the two tokens you’d like to contribute. Your available balances will be displayed to help you decide.
Set Your Contribution: Input the amount of each token to add. Monark’s interface will guide you through setting your liquidity range to maximize your potential earnings.
Confirm Your Deposit: Once your settings are in place, confirm the transaction. Approve it within your wallet, and your tokens will enter the liquidity pool.
With that, you’ve successfully contributed liquidity to Monark’s ecosystem! In return, you’ll receive tokens representing your position in the pool, allowing you to track and manage your liquidity.
Retrieving Your Tokens
Your liquidity position is always accessible. When you’re ready to withdraw, simply return to the liquidity page, select your position, and specify how much you want to remove. After confirming the transaction, your tokens will be returned to your wallet securely.
Managing Risk: Impermanent Loss
As with all liquidity provisioning, it’s important to be aware of impermanent loss—a risk that occurs when the prices of the tokens in your pool fluctuate. At Monark, we’re committed to minimizing risks while maximizing rewards. Our v4 AMM includes advanced risk management features, ensuring that liquidity providers are protected as much as possible from market volatility.
Last updated