DeFi protocols that use Automated Market Makers (AMM) for liquidityLiquidity is a measure of the degree to which an asset or security can be quickly bought or sold in... Read More pools pose a unique risk of impermanent loss. When you provide liquidity for an AMM-based liquidity poolLiquidity pools are shared pools of assets that are readily available for trading on a decentralized exchange. To form a... Read More, your cryptocurrencyCryptocurrency is decentralized digital currency secured by cryptography. Cryptocurrency utilizes cryptographic protocols to record ownership and prevent counterfeits (when ownership... Read More assets act as collateral. If the price of the asset changes while it is in the liquidity pool, you may suffer a loss even if no one uses your cryptocurrency to buy or sell anything.
