learn defi
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lesson 2 of 5

becoming a liquidity provider

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depositing into pools

Liquidity providers (LPs) deposit equal value of two tokens into a pool — e.g., $500 of ETH + $500 of USDC. In return, they receive LP tokens representing their share of the pool. They earn trading fees (typically 0.05-0.3% per swap) proportional to their share.

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