Providing Liquidity on Arbitrum
Currently, there is only one way to provide liquidity and earn rewards on Synthetix V3 deployed on Arbitrum:
Manually through the Synthetix V3 LP app (Toros integration is pending)
On Arbitrum, Synthetix V3 supports six LP assets:
USDC
ARB
ETH
USDe
EtherFi weETH
Lido wstETH
Additionally, users can borrow an Arbitrum-native stablecoin, USDx, against their collateral.
In the coming weeks, Synthetix V3 on Arbitrum will support additional collateral types, including:
Ethena sUSDe
Aave lending tokens
Providing Liquidity Directly in the V3 LP App
Bridge or obtain one of the supported LP assets on Arbitrum.
Go to the Synthetix V3 LP app.
Connect your wallet, switch the network to Arbitrum, then click 'Create Account'.
Click "Deposit" on the tab of the asset you wish to provide as collateral within the Spartan Council Pool.
Deposit your collateral.
You are now an LP. Trading fees will be earned once Synthetix Perps is live on Arbitrum.
Key Points to Understand:
Collateral determines your share of incentives and future trading fees (different from V2's debt-based distribution).
A 24-hour lock applies to withdrawals for collateral, new deposits, and other activities reset the timer.
LPs can only supply supported collateral to earn incentives and future trading fees (no sUSD minting capability).
Wrapped tokens may appear in your wallet or on Arbiscan.
Future fee split: 40% to LPs, 40% to SNX buyback and burn, 20% to integrators.
Reference other blog posts for incentive program details and timelines.
Risks of LPing
⚠️ Skew or poor market performance can increase debt (Perps is not live yet, so no market performance/skew risks at this time)
In the first few weeks after launch, debt levels may fluctuate based on trader performance and market conditions.
As Open Interest caps are increased, arbitrageurs are expected to balance any skew in the Perps markets, neutralizing its impact on debt.
⚠️ Smart contract vulnerabilities ⚠️ Collateral depeg
As always, do your own research and only deposit what you can afford to lose. Understanding the risks is crucial before participating as a liquidity provider.
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