Concentrated liquidity
In a concentrated liquidity pool you choose a price range for your position. While the price trades inside it, your capital is used for every swap and earns fees. Outside it, your position earns nothing until price comes back or you move the range.
SOL / USDC · 0.04%
Ranges and ticks
Prices in a concentrated pool are split into ticks, and a range always starts and ends on one. The pool’s fee tier sets the tick spacing: tighter tiers such as 0.01% suit stable pairs, wider ones such as 0.30% suit volatile pairs.
When price leaves your range
As price rises through your range, the pool sells your base token for the quote token. Above the range, you hold only the quote token. Below it, only the base token.
SOL / USDC · 0.04%
Out of range is not a loss in itself, but it is idle capital. Range alerts tell you the moment it happens.
Choosing a width
- Narrow
- Highest fees per dollar while in range. Needs frequent rebalancing and magnifies impermanent loss. Best for stable pairs.
- Medium
- A balance of fee capture and time in range. A sensible default for majors such as ETH / USDC.
- Wide
- Stays in range through big moves and needs little attention. Earns less per dollar.
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