What is Liquidity Mining?
Liquidity mining (aka yield farming) is investing in cryptocurrency liquidity pools to earn the highest possible returns. The returns depend on interest rates, pool share, and impermanent loss. So profits from liquidity mining are affected by a steep price rise in any of the cryptocurrencies in the pool and the trade volumes.
Related Terms
- Annual Percentage Rate (APR)
- Annual Percentage Yield (APY)
- Impermanent Loss
- Liquidity
- Liquidity Pool
- Liquidity Provider
Learn More Crypto Terms
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