DeFi｜What is impermanent loss?
Using an x × y = k pool as an example, when one token rises to twice its value relative to the other, the impermanent loss is about 5.7%.
When prices move, arbitrage traders swap the appreciating token out of the pool and leave the depreciating one behind. As a result, your share contains fewer and fewer of the appreciating token.
A quick glance: $UNI is quoted at 7.094, 24h +0.82%.
Markets are always uncertain, so decide in advance what you’ll do if your judgment turns out to be wrong.
Using an x × y = k pool as an example, when one token rises to twice its value relative to the other, the impermanent loss is about 5.7%.
When prices move, arbitrage traders swap the appreciating token out of the pool and leave the depreciating one behind. As a result, your share contains fewer and fewer of the appreciating token.
A quick glance: $UNI is quoted at 7.094, 24h +0.82%.
Markets are always uncertain, so decide in advance what you’ll do if your judgment turns out to be wrong.
