How to add / remove liquidity
Last updated
Last updated
When you add your token to a Liquidity Pool you will receive Liquidity Provider (LP) tokens and share in the fees.
"Liquidity" is central to how PolyDEX's Exchange works. You can add liquidity for any token pair by staking both through the Liquidity tab on exchange page
In return for adding liquidity, you'll receive trading fees for that pair, and receive PolyDEX-LP tokens you can stake in Farms to earn CAKE rewards!
As an example, if you deposited CNT and MATIC into a Liquidity Pool, you'd receive PolyDEX-LP tokens.
The number of LP tokens you receive represents your portion of the CNT-Matic Liquidity Pool.
You can also redeem your funds at any time by removing your liquidity.
Providing liquidity gives you a reward in the form of trading fees when people use your liquidity pool.
Whenever someone trades on PolyDEX, the trader pays a 0.3% fee, of which 0.25% is added to the Liquidity Pool of the swap pair they traded on.
For example:
There are 10 LP tokens representing 10 CNT and 10 MATIC tokens.
1 LP token = 1 CNT + 1 MATIC
Someone trades 10 CNT for 10 MATIC.
Someone else trades 10 MATIC for 10 CNT.
The CNT/MATIC liquidity pool now has 10.017 CNT and 10.017 MATIC.
Each LP token is now worth 1.00017 CNT + 1.00017 MATIC.
To make being a liquidity provider even more worth your while, you can also put your LP tokens to work on the Farms while still earning your 0.25% trading fee reward.
Providing liquidity is not without risk, as you may be exposed to impermanent loss.
To provide liquidity, you’ll need to commit an amount of any token pair you like. Your lowest value (in USD) of the two tokens will be the limit to the liquidity you can provide.
You can easily trade for any tokens you need. Visit our How to trade tokens guide if you need to.
In this example, we will add liquidity using MATIC and CNT.
1. Visit the Liquidity page.
2. Click the Add Liquidity button.
3. Select Input Tokens
5. Enter an amount on one of the tokens under “Input”. The other will calculate automatically.
(If your balance is too low on one pair enter a lower amount.)
6. Click the Approve button. Your wallet will ask you to confirm the action.
7. The Supply button will light up. Click it.
8. A window will appear saying how much you will receive. Click the Confirm Supply button. Your wallet will ask you to confirm the action.
9. After a short wait you will see your LP Token balance at the bottom of the page.
You can repeat the steps above to add more liquidity at any time.
To remove liquidity.
1. Visit the Liquidity page.
2. Click on your pair under “Your Liquidity”.
3. Click Remove. A new window will appear.
4. Use the buttons or slider to choose what percent to remove. Choose MAX to remove everything.
5. Click Approve. Your wallet will ask you to confirm the action.
6. The Remove button will light up. Click it.
7. A window will appear saying what you will receive. Click Confirm. Your wallet will ask you to confirm the action.
8. After a short wait you will see your new LP Token balance at the bottom of the page.
