LP: what it is and where the yield comes from

LP (Liquidity Pool) is a smart contract that holds assets (usually in a pair) and enables swaps on a DEX.

When a user swaps one token for another, they pay a fee.
This fee is distributed among those who provide liquidity to the pool.

📘 Why does LP matter?
Without liquidity, swaps can’t happen.
LP is the foundation of any decentralized exchange.

By providing liquidity, you:
1. help the protocol and market function smoothly;
2. earn a share of swap fees.

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