Liquidity Mining

Liquidity mining really confused me at first and it typically is riskier than just staking a coin.

You have to add tokens to a liquidity pool and get Liquidity Pool tokens (LP Tokens) . Read This if this is your first time using Liquidity Pools. https://finematics.com/impermanent-loss-explained / Impermeant Loss is where you would have less of a token after withdrawing from the Liquidity Pool than you put in.

To offset the IL some projects will offer what’s called liquidity mining. You stake the LP tokens on a smart contract that will net you rewards outside of the .3 percent trading fee. The risk levels go from pretty safe to tokens that get rugged or crash in value before you would break even with rewards.

In the raging bull market earlier this year Liquidity Mining was a lot better with huge returns sometimes. I’ll go over a few examples.

First example is going to be a liquidity mining coin that is like 90 percent down from when I bought it.