Question 1

What is impermanent loss?

Accepted Answer

It’s the gap between holding two tokens versus supplying them to an automated market maker as prices diverge. The pool rebalances you into more of the falling asset, so you end with less value than if you’d simply held. It becomes permanent if you withdraw before prices revert.

Question 2

When do LP fees beat just holding?

Accepted Answer

When the fee APR earned over your holding period exceeds the impermanent loss caused by price divergence. Stable or correlated pairs have tiny IL, so modest fees win. Volatile pairs need very high fee APR to compensate — often they don’t, and holding wins.

Calculateur du seuil de rentabilité des frais de perte impermanente

Les frais doivent dépasser les divergences