Elysium Liquidity Pools — v2 & v3
Understand how liquidity supports Elysium token swaps, the differences between pool designs, and the risks and fees relevant to liquidity providers.
What are Elysium liquidity pools?
Liquidity pools are smart-contract reserves used by decentralized exchanges to trade one asset for another. Instead of finding a matching order on a traditional order book, a swap can execute against token balances in a pool.
Public ElysiumSwap material describes v2 and v3 pools, including pairs containing WHYPE and USDC. Pool availability, asset values, fees and liquidity change continuously; a displayed pool is not evidence that any particular deposit is suitable or profitable.
ElysiumSwap v2 vs v3 liquidity
| Feature | v2-style pools | v3-style pools |
|---|---|---|
| Liquidity placement | Distributed across the price curve | Can be concentrated within chosen ranges |
| Position management | Generally simpler to maintain | Can require attention to the selected range |
| Fee participation | Depends on pool share and traded volume | Depends on in-range liquidity and traded volume |
| Key risks | Impermanent loss, token and contract risk | The same risks plus out-of-range exposure |
These are common differences in AMM designs. Exact pool implementations may have additional constraints or custom settings.
How liquidity provision works
Choose a token pair
Check that both contract addresses and the intended Elysium network are correct.
Inspect the pool
Review pool depth, fee tier, trading activity and smart-contract information.
Assess the position
Check the required token amounts and, where applicable, the v3 price range.
Review wallet approvals
Only approve spending permissions needed for the intended transaction.
Monitor and manage
Watch the position's value, fees and price-range behavior; adjust or withdraw when appropriate.
How LP fees relate to token swaps
When a pool executes a trade, its trading fee can contribute to returns for eligible liquidity providers according to the pool's rules. Volume, pool composition, fee tier and your share of active liquidity all affect the amount. Fee income is variable and does not remove exposure to token price changes.
Swap routing can also send orders through more than one pool. This may alter which liquidity providers receive fees for a particular transaction.
Impermanent loss and liquidity risks
Impermanent loss is the difference between holding assets separately and holding them in a changing AMM pool. In concentrated liquidity, a price moving outside your range can leave a position predominantly in one asset. Additional risks include smart-contract failures, volatile assets, depegging, thin markets and transaction costs.
Trading fees can be lower than market losses or operational costs. Review contract data and current pool settings before providing assets.