Liquidity Pools

Provide liquidity to facilitate DEX swaps and earn $PEARL

Providing Liquidity

Users provide liquidity to individual Pearl pools in exchange for LP tokens. By staking these LP tokens on the platform, users are eligible for $PEARL emissions. Emission rates to various pools are determined by Pearl gauges which are controlled by $vePEARL voters. More on voting in the following section.

The deeper the liquidity i.e. the larger the pool, the less slippage customers will experience when trading between two assets. As such, our goal is to create the deepest liquidity possible for our trading pairs, incentivizing liquidity through large projectable bribes, as outlined in the Pearl Flywheel.

Pearl offers two different types of liquidity pools types based on the tokens being provided:

• sAMM: For strongly correlated pairs i.e. $USDR and $USDC

• vAMM: For assets with low price correlation i.e $PEARL and $USDR

Incentives for liquidity providers are based on the following criteria:

• The proportion of LP tokens that a user has staked to the total staked LP tokens of that liquidity pair.

• The volume of emissions that pair has earned based on the outcome of gauge voting for rewards in that Epoch.

When providing liquidity, there are no hidden fees or obligations and you can withdraw your liquidity at any time.

Impermanent loss is a yield farming risk when one asset in a liquidity pool significantly outperforms the other, shifting their relative values and potentially causing losses for liquidity providers (LPs) compared to just holding the assets. Understanding and mitigating this risk is vital before engaging in yield farming.

Pairing Requirements and Token Whitelisting

For auto-bribing to work as designed, USDR must be integrated as the base stablecoin throughout the site. To receive a gauge, any token being paired with a stablecoin will need to be paired with USDR.

New tokens also also need to be whitelisted. The team keeps a control over new tokens being listed in order to filter out scams and illegitimate projects. Only whitelisted tokens will be approved to pair with USDR. As a result, only the top protocols and RWA tokens will receive a gauge on the DEX.

To request a custom gauge, please open a ticket on Discord.