Provide Liquidity

The Synthetix Liquidity App offer users a way to passively earn fees and rewards by providing the liquidity to power trading products in the Synthetix ecosystem.

How does Providing Liquidity work?

Fees from Synthetix products are directed to Liquidity Providers (LPs) in addition to rewards from various incentive programs. LPs earn a share of these fees and rewards distributed pro-rata according to their share of the total liquidity provided.

Providing liquidity allows users to collectively function similar to an aggregated "market maker", filling the AMM with liquidity to provide low-slippage trade execution across all supported markets.

Trading fees, negative trader performance, and trader liquidations result in higher rewards for LPs. Conversely, positive trader performance results in lower rewards for LPs.

In extreme circumstances, if the amount of winning trades exceeds the fees collected from losing trades, liquidations, and other fees, LP performance can be negative and accrue debt. See Security & Risks for more on the risks of LP'ing.

Get Started

  1. Visit https://liquidity.synthetix.io/

  2. Connect your wallet and create an account.

  3. Select the asset you wish to deposit.

  4. Under “Manage Collateral” choose “Deposit and Lock”, select the amount to deposit, click “Deposit and Lock Collateral” and sign the approval and transfer transactions.

Any depositing, locking, claiming rewards, or unlocking of liquidity triggers a 24 hour waiting period before withdrawing.

Claiming Liquidation Rewards and Incentives

  1. From the Liquidity App dashboard, you can find your liquidated trader collateral rewards and additional incentive rewards in the Rewards section.

  1. Click "Claim" to claim your Rewards.

Withdrawing a subset of your position

  1. Find your active position by navigating to the Liquidity App and selecting the network of your deposit, i.e. Base.

  2. Repay any debt from borrowing under the “Manage Debt” tab.

  3. Select the "Manage Collateral" tab.

  4. Select "Unlock" and the amount of deposited collateral to unlock.

  5. Sign the transaction to unlock your collateral.

Shown after the unlock transaction

  • Note: Any activity, including claiming rewards, will reset this 24 hour timer.

  1. After the unlocking period of 24 hours, you may return and withdraw your deposit.

Closing your position

  1. Click Manage on the position you would like to fully withdraw

  2. Click Close Position. This will bring up the Close Position modal.

  1. Repay any debt associated with your position with USDC in your wallet. By approving USDC transfer and Unlocking collateral transactions. This will begin a 24 hour withdrawal cooldown timer.

  1. After 24 hours, navigate back to the withdraw modal to withdraw.

  1. Once the 24 hour cooldown window has ended, you can withdraw.

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