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Akshay Sinha
@asinha.eth
The PROXY/WETH and WDEGEN/WETH vaults on @proxyswap have low liquidity. We encourage users to not deposit a significant amount in these pools in a single txn until we get past $70-80k. If you have already deposited, put your yield tokens to farm instead of trying to move that liquidity. The LP rewards will be auto-compounded back into the vault soon!
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alex
@alexgrover.eth
Mind giving me a short run down of what’s happening under the hood here and why the deposit size matters? Admittedly didn’t do much research before depositing and trying to understand what I should expect to be happening to my principal amount
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Akshay Sinha
@asinha.eth
Sure, here is how you add LP directly in any v3 pool. Get Token1 and Token2 in a certain ratio (ratio depends on the current price of the pool, the upper range selected and the lower range selected). Let's take an example case: If price of Token1/Token2 is 2000, and the user selects a range of 1000-4000, they will be required to add the tokens in a 50:50 ratio. So users buy Token2 from their Token1 directly on the pool and then add liquidty back into the pool. (This is a bad UX for anyone looking to generate yield on their tokens and requires some level of Maths/DeFi understanding) Everytime the price moves out of the range, you also need to rebalance your position so that your LP position still earns the swap fees.
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