It seems that most people adding liquidity are losing money?
Is adding LP to Alpha tokens not a good way to make money?
The actual situation: only very narrow ranges yield decent returns, but they are particularly prone to going out of range, resulting in the money earned not covering impermanent loss.
Moreover, a popular saying goes: if you provide enough liquidity, the project team will withdraw the liquidity, and in the end, you become the liquidity.
In the face of the actual situation, if you want to make money in the post-Alpha liquidity era, the key is to avoid the hottest tokens and the most popular trading pairs, steering clear of competition with the big scientists.
➤ Practiced strategies:
1) Some tokens that are not top in trading volume, but have some trading volume or decent mechanisms, don’t need to have such narrow ranges set; you can take some time to look for them. For example, my previous strategy regarding Jager: https://www.binance.com/zh-CN/square/post/25155837375313
2) If the BNB-XXX trading pair is very competitive, it might be worth looking at USDT-XXX or USD1-XXX. This is because, to ensure that the prices of tokens on different trading pairs remain synchronized on-chain, there will be automatic/arbitrage trading between different trading pairs, so there is also trading volume. I mentioned this in my Reddio sharing: https://www.binance.com/zh-CN/square/post/25413991807202
However, in recent days, Alpha's trading volume has been continuously declining. If there is no reversal, this liquidity mining feast may soon come to an end.
Therefore, it is crucial to be careful not to become liquidity yourself.