FAQ for LPs

Note for DEX Teams:

This section addresses the most common questions liquidity providers may have while using your Algebra-powered DEX. From how yields are generated to managing out-of-range positions, these answers help users better understand their role and returns in a concentrated liquidity environment.

Tailor the section to reflect your specific UI, pool configurations, and reward mechanics.

Where does my yield come from?

Your total return is a combination of (a) swap fees—paid by traders on every swap—and (b) farming or incentive rewards (when a farming campaign is active). Both sources are automatically added to your position’s pending fees.

How are fees earned and distributed?

Every time a swap occurs in a pool, a fee is charged and proportionally distributed to active liquidity providers—those whose liquidity is within the current trading price range. You can collect fees by clicking “Claim Fees” button in your position tab.

Where can I see and manage my position?

Go to the “Pools” page and open the “My Pools” tab. There you’ll find each active (or inactive) position, its current value, price range, and unclaimed fees.

Can I provide liquidity across the full price range?

Yes. Select “Full Range” when creating a position. Full‑range LPs earn lower APR than narrow‑range LPs, but they rarely fall out of range and require minimal upkeep.

How do I add full‑range liquidity?

When setting your price range, click the “Full Range” button; the interface will auto‑fill the widest possible range (0 → ∞). Confirm the deposit as usual.

Can I create a new liquidity pool?

If the token pair doesn't exist yet, you can create a new pool by clicking “Create Pool” button in the “Pools” tab.

Can I withdraw my liquidity (redeem my LP tokens)?

Yes. You can redeem your LP tokens at any time to withdraw your share of the pool, including your portion of the fees and any earned rewards.

What happens if the market price moves outside my range?

Your liquidity becomes inactive and concentrated in one asset. You won’t earn trading fees until the price re-enters your specified range. Your options: • Wait until the price returns. • Adjust your position by removing and re-adding liquidity with a new range. • Exit and redeploy elsewhere. Narrow ranges offer higher potential fees but require more monitoring; wider ranges are safer but yield less.