💧Pools

Provide liquidity to the pool and receive part of every swap's fee.

Here you will learn about the liquidity pools, their types on DeDust, how they work, how to deposit and withdraw the liquidity to/from pools. And how to earn on providing liquidity.

What is a Liquidity pool

Very simplified, liquidity pool is a 'trading pair' of two cryptocurrencies on a decentrilized exchange (DEX), serving to allow users to swap one crypto for another, i.e. TON to USDT.

If more complicated, liquidity pool is:

• a kind of vault, a storage, containing a combination (usually a pair) of cryptocurrency tokens (usually in 50/50 proportion), allowing users to buy from (or sell to) that pool one token for another,

and on the other hand,

• a smart contract deployed in the blockchain — a program code with a set of strict rules, defining how a specific liquidity pool operates and executes the swaps, initiated by users.

Once a pair of assets (tokens) is placed to the liquidity pool, users can start trading those assets. Then, putting certain amount of one token to a pool ('selling' it to the pool) user gets in turn some amount of another token from that pool ('buying' it from the pool), according to its exchange rate.

Only the proportion (amounts) of two assets in a pool defines one's 'price' expressed in another, and defines their exchange rate in that specific pool. And the more (or assets, in total) the pool contains, the less will be the price impact (exchange rate deviation) with every swap in it.

For every exchange in a pool it withholds a fee, called Trading fee — from a user performing the swap.

How it works on DeDust

• The trading fees might vary in different pools.

• 80% of fees is distributed between all liqidity providers of the pool, according to their share.

• Another 20% of fees is used to buyback $DUST tokens from market and reward holders for staking.

• The fee is always deducted from trader's amount of tokens that he spends performing a swap (and the rest goes already for an exchange itself).

• The trading fee is only withheld if a swap was successful.

• Each liquidity provider's portion of a trading fee is being auto-compounded to the total amount of provider's tokens amount in the pool (added to his position, with every swap).

Filters on the Pools page

• Boosted — the pools with additional boost rewards.

• Stable — the stable-swap pools with near equal value assets.

• Promo — the pools we consider worth exploring.

Liquidity pools types

DeDust now offers two main types of liquidity pools:

1. Volatile Pool — Operates based on the commonly used "Constant Product" formula: x * y = k. Default trading fee for such pools is 0.25%, but fee levels in range from 0.1% to 1% are also possible.

2. Stable-Swap Pool — Optimized for assets of near-equal value (e.g. USDT / USDC, TON / stTON). It uses the formula: x^3 * y + y^3 * x = k. For such pools the trading fee is 0.05%.

Pools containing at least one non-whitelisted token will be shown on Pools page only after you import the non-whitelisted token(s).