💧 Adding Liquidity via a DEX

Users can add liquidity to the pool, which earns rewards in the form of trading fees while reducing slippage when trading 💧

Below is a quick example of how this works:

🔴 Swapping 10 myXXX for 10 YYY

This swap has a price impact on the liquidity pool, meaning the ratio is no longer 1:1. In this example, the user will actually receive ~90.9090 myXXX tokens instead of 100 - the price impact is so large because there are only 1,000 YYY & 1,000 myXXX tokens in the pool.

When adding the transaction fee on top of this, the user receives 1.2% less myXXX than the ~90.9090 tokens (~89.81809). Once the user adds liquidity to the pool, the total amount of myXXX tokens again decreases to ~88.7402.