💼 Liquidity Provision: One More Way to Earn More

In our post about DEX, we mentioned that they rely on liquidity pools instead of the traditional order books used by CEX. However, here's something we didn't dive into—earnings in these pools come not only from buying and selling but also from providing liquidity itself.

📝 A bit of background information:

A liquidity pool is essentially a storage of funds for each token pair. When making a swap, you deposit one token into the pool to withdraw another of equivalent value. It’s important to remember that the token’s price isn’t fixed—it rises when you buy and falls when you sell.

🤷 How do tokens end up in liquidity pools?

Now we’ve reached the point where liquidity providers (LP) come into play. Anyone can deposit two tokens of equal value in $ into a pool and receive special LP tokens in return. These LP tokens gradually increase in value as trading fees are reinvested into the pool, providing a source of passive income for liquidity providers.

🔍 Where to become a liquidity provider on TON?

This can be done directly in Telegram through Apps Center, which offers several options like DeDust.io, STON.fi, and TONCO. An interesting aspect is that these exchanges incentivize liquidity provision with features like boosts and farming, offering additional rewards and opportunities.

🛹 Exploring and trying something new is always exciting, especially when it has the potential to generate profit. Liquidity provision is one of those cases where curiosity can be both rewarding and beneficial.