💧Liquidity Pools

Earning Passive Income: Utilizing Liquidity Pools in the Scopuly Mobile App

Understanding liquidity pools:

Think of liquidity pools as reserves of digital assets on DeFi platforms like Scopuly. They ensure smooth trading by holding equal values of two different tokens (e.g. XLM and USDC). When users trade on Scopuly, they are essentially exchanging tokens from this pool. Liquidity providers, such as yourself, contribute assets to these pools and are rewarded for facilitating trades.

Finding Liquidity Pools:

1. Open the Side Menu:

• Launch the Scopuly mobile application on your device.

• On the home page, tap the menu icon in the upper left corner (represented by three horizontal lines).

2. Navigate to “Liquidity Pools”:

• The side menu will open. Scroll down until you find the “Liquidity Pools” item and tap on it.

3. Browse Available Pools:

• The “Liquidity Pools” window will open, displaying a list of available asset pools (e.g., SCOP/XLM, USDC/XLM).

• Each pool represents a trading pair.

4. Select a Pool:

• Browse the list and select the liquidity pool you want to contribute to by tapping on it.

5. View Pool Information:

• A window with information about the selected pool will open. This includes: - “Deposit” Button: To add liquidity to the pool. - “Withdraw” Button: To remove liquidity from the pool (if you are already providing it). - APY (%): The Annual Percentage Yield, representing the estimated annual return you can earn by providing liquidity. - Volume (24h): The trading volume within the pool over the last 24 hours. Higher volume generally means more trading fees generated. - Earned (24h): The total rewards generated by the pool over the last 24 hours, distributed among all liquidity providers. - Trade History: A record of recent trades within the pool.

How to Add an Asset from a Pool to Trustline

How to Add Liquidity to a Liquidity Pool

How to Withdraw Liquidity from a Liquidity Pool

Important Considerations for Liquidity Pools:

• Impermanent Loss: Be aware of the risk of impermanent loss, which can occur when the price of the assets in the pool diverges.

• Pool Risks: Understand the risks associated with specific liquidity pools and the assets they contain.

• APY Fluctuations: The APY (Annual Percentage Yield) can fluctuate based on trading volume and other factors.

• Trustlines: Ensure you have the necessary trustlines before participating in a pool.

• Network Fees: Adding and withdrawing liquidity involves Stellar network transaction fees.