Paul加密奇葩说
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If you don't know this, go add liquidity and earn points; you'll lose everything sooner or later.
Binance has just launched a feature to earn alpha points through wealth management. Here, I would like to share some of my thoughts with everyone, hoping it can help you.
Point Rules:
Point Rules
This score is quite similar to the balance, so we won’t explain too much. Essentially, you can understand that previously, your balance could be any amount of U, but this liquidity balance requires two types of tokens, such as alpha token + BNB.
Here, we mainly discuss some risks of adding liquidity:
1. Impermanent Loss: Simply put, as shown in the diagram, you deposit BNB and USDT to provide liquidity, but later due to price fluctuations, the value of your asset combination (in the diagram, USDT + BNB) is lower than the value of the two types of tokens you hold. To put it simply, the transaction fees and APR you earn are not sufficient to cover the depreciation of your principal.
Point Rules:
Point Rules
This score is quite similar to the balance, so we won’t explain too much. Essentially, you can understand that previously, your balance could be any amount of U, but this liquidity balance requires two types of tokens, such as alpha token + BNB.
Here, we mainly discuss some risks of adding liquidity:
1. Impermanent Loss: Simply put, as shown in the diagram, you deposit BNB and USDT to provide liquidity, but later due to price fluctuations, the value of your asset combination (in the diagram, USDT + BNB) is lower than the value of the two types of tokens you hold. To put it simply, the transaction fees and APR you earn are not sufficient to cover the depreciation of your principal.
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