W Chain Website

Liquidity

Provide and manage liquidity in constant-product AMM pools on W Chain. This guide covers creating positions, understanding LP tokens and fees, and safely removing liquidity.

Overview

  • Network: W Chain (EVM-compatible; native gas token WCO)

  • Model: a constant-product AMM (x·y = k)

  • LP Tokens: Minted to represent your position; burned when removing liquidity

  • Fees: 0.25% per trade paid to LPs (accrues within pool reserves)

Prerequisites

  • A supported wallet (e.g., Rabby or Metamask) connected to W Chain.

  • Sufficient WCO for gas.

  • The two assets you want to deposit. If assets are on Ethereum or BNB Chain, bridge them first.

Add Liquidity

  1. Open Liquidity or Add Liquidity page.

  2. Select the token pair (Token A and Token B). You may paste contract addresses for custom tokens.

  3. Enter an amount for one token; the UI computes the corresponding amount for the other token based on current pool price.

  4. Approve spending for each token if prompted (Approve Token A / Approve Token B).

  5. Review details:

    • Pool Share: Estimated percentage of the pool you’ll own.

    • Prices: Implied exchange rates after your deposit.

    • Slippage/Min Received: Relevant when creating the initial pool or large deposits.

  6. Click Supply (or Add Liquidity) and confirm in your wallet.

  7. After confirmation, you receive LP tokens representing your position.

Notes:

  • If a pool does not exist yet, your deposit sets the initial price. Carefully choose amounts to avoid unintended pricing.

  • For new pools, higher slippage tolerance may be needed; the UI will guide you.

Remove Liquidity

  1. Navigate to your position (e.g., Pool page or Your Liquidity).

  2. Choose the position and select Remove.

  3. If prompted, approve the router to spend your LP tokens (Approve LP).

  4. Select the percentage to remove (e.g., 25%, 50%, 100%).

  5. Review expected amounts of Token A and Token B.

  6. Click Remove, confirm in your wallet, and wait for the transaction to finalize.

Fees and Rewards

  • Each trade pays a 0.25% liquidity fee to LPs, accruing inside the pool as additional reserves.

  • Your portion of fees is implicit in the increased value of your LP tokens.

  • Realization occurs when you withdraw liquidity (your redeemed amounts include fee accrual).

Risks and Best Practices

  • Impermanent Loss: Price divergence between tokens can reduce your position value vs. holding.

  • Slippage: Large deposits/withdrawals can move price; consider splitting actions.

  • Smart Contract Risk: Use official UI and verified token addresses.

  • Gas Costs: Keep WCO for approvals, adds, and removals.

Troubleshooting

  • Approve Required: Approve both tokens before adding liquidity; approve LPs before removing.

  • Insufficient Balance: Confirm balances on W Chain and consider bridging if needed.

  • Transaction Reverted: Increase slippage tolerance or reduce deposit size.

  • No Positions Visible: Ensure correct wallet and network (W Chain) are selected.

FAQs

  • How do I earn fees? Fees accumulate in the pool; your LP token share entitles you to a proportional claim when you withdraw.

  • Can I add single-sided liquidity? a constant-product AMM requires balanced deposits; use a swap first if needed.

  • Where can I see my positions? Use the Pool or Your Liquidity view in the DApp.

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