STON.FI IMPERMANENT LOSS PROTECTION.
Impermanent loss is a common concern for liquidity providers (LPs) in decentralized finance (DeFi).
This occurs when the value of assets in a liquidity pool diverges compared to simply holding them in a stablecoin, potentially leading to reduced returns. To address this, STON.fi has introduced an Impermanent Loss Protection program, offering safety for Liquidity providers.
How Does STON.fi's Impermanent Loss Protection Work?
STON.fi's program is designed to offset a portion of the impermanent loss that LPs might experience.
Here's how it functions:
The protection applies exclusively to the STON/USDT V2 liquidity pool.
LPs can receive compensation for up to 5.72% of their impermanent loss, which corresponds to a 50% decrease in the price of the pooled assets.
The coverage is available from December 12, 2024, to January 31, 2025. To qualify, LPs must provide liquidity by January 1, 2025, and maintain their position throughout the entire month.
The program has a monthly offset budget capped at $10,000, with a maximum offset of $100 per user. Compensation is automatically credited in STON tokens, eliminating the need for manual claims.
Eligibility Criteria
To be eligible for the impermanent loss protection:
1. Liquidity Provision: Contribute to the STON/USDT V2 pool by January 1, 2025.
2. Duration: Maintain your liquidity position in the pool for the entire month to qualify for compensation.
Benefits of Participating
💎 Risk Mitigation: The program reduces potential losses, allowing LPs to provide liquidity with greater confidence.
💎 Enhanced Returns: By offsetting impermanent loss, LPs can achieve higher net returns on their contributions.
💎 Seamless Compensation: Automatic crediting of compensation in STON tokens ensures a hassle-free experience.
For more information use the details on the graphics above.
