Provide Liquidity — Earn Rewards by Helping Others Trade
When you provide liquidity, you help others trade instantly. In return, you earn a share of the rewards. This page explains how, in plain words.
What it is
Every trade needs a pool of coins to draw from. A pool holds two coins, ready for anyone to swap between them.
You provide liquidity when you put two coins into that shared pool. Others trade against the pool. You earn a share of the rewards it collects.
Think of it like a vending machine. You stock the drinks. Every sale gives you a small cut.
One example
A pool holds OmniCoin and USDC. You add both, in equal value. Say you add $100 of OmniCoin and $100 of USDC.
Now your $200 is in the pool. When people swap between the two coins, they pay a small fee. That fee is shared with everyone who stocked the pool — including you.
Your share of the rewards matches your share of the pool. The more you add, the larger your cut.
Why people care
Your coins work for you. Instead of sitting idle, they help trades happen. You earn a share of the trading rewards.
Impermanent loss, in plain words
Here is the honest catch. The two coins in a pool can change price relative to each other.
Say OmniCoin rises a lot while USDC stays the same. The pool rebalances to keep both sides even. You can end up with a mix that is worth less than if you had just held both coins separately.
This is called impermanent loss. "Impermanent" means it can go away if prices return. It becomes real only if you leave the pool while prices are far apart.
This is the Early Liquidity program
Providing liquidity on OmniBazaar is called the Early Liquidity program. It has its own rewards and its own rules. Read the next page for the full details.
Start now
Open the app at app.omnibazaar.com — free, nothing to install. See the pool and decide if providing liquidity fits you.