RE: Impermanent Loss Of Liquidity Pool
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Did you lose something till now? How did you act? Did you manage to add more to achieve the balance and avoid loses?
Would be interesting to see a real case. Thanks
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I invested in the USDT-DFI pair for liquidity mining. The price of DFI has been rising affected the balance. My USDT had increased while my DFI had reduced. When I calculated, I would have earned more if I held on to my DFI based on the price increase in the market actually. I decided to take out half of my liquidity. I invested the DFI into staking on Cake Defi for the liquidity that I pulled out to earn a constant reward of 37%. When I get my reward mainly in DFI from the liquidity pool daily, I would put the DFI reward into the staking pool so I hope it does balance the loss. The DFI in the USDT-DFI pair is the one that is reducing greatly due to its price improvement. In term of total value, I did not really lose. The impermanent loss for my case is the lost of possible profit if I held on to my DFI and sold it without putting my DFI into the pool. Nevertheless, the reward from the liquidity pool may help to offset the impermanent loss if I keep my investment in the pool for a longer period and the APY does not change drastically.
Thanks for the explanation. It is making more sense.
I wanted to stake some DEC on unsiwap, but gave it up in the end as it was to complicated.
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