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How LP tokens work
So if you were to contribute liquidity (in the shape of assets) to liquidity pools on these DEXs, you would be issued LP tokens. These tokens track your individual contributions to the overall liquidity pool and correspond in direct proportion to your share of liquidity in the overall pool. The value of 1 LP token…
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What are Liquidity Provider tokens or LP Tokens?
When people provide liquidity on decentralised exchanges or DEXs that operate on the automated market maker (AMM) protocols, they are usually issued separate tokens that represent their share of liquidity on the liquidity pools. These are called liquidity provider tokens or liquidity pool tokens, abbreviated as LP tokens. Uniswap and SushiSwap are major DEXs on…
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Is it safe to make money from becoming a Liquidity Provider?
The short answer is yes, you can reliably make money from becoming a liquidity provider by earning a portion of the trading fees imposed by the DEX on traders. Bear in mind, however, that this all comes with its own caveats and risks you must understand. We’ll briefly cover some of the risks of becoming…
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Liquidity Provider in Cryptocurrency?
Liquidity Providers are how decentralised exchanges or DEXs allow people to trade without an intermediary. Instead of having a large central entity providing all of the digital assets for trading, DEXs rely on individuals and institutions to provide their own cryptocurrencies to a common pool, with which others may trade. These providers are called Liquidity…
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What to look for when choosing a crypto staking platform
When choosing a crypto staking platform, it is important to understand what your needs are as a user. Obviously, the amount of yield you can earn from staking will be an important part of the overall selection criteria but there are other factors to consider as well. For example, all of the sites covered in…
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eToro
eToro is the oldest among the options listed here as it actually started life out as a digital broker that today includes cryptocurrency markets. Because of its experience in traditional markets, it has a large user base of traders active in stocks, commodities and forex. As a cryptocurrency broker, eToro also allows for crypto staking from…
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Crypto.com
Crypto.com started life out as a crypto card project in 2016 but after years of delays rebranded as a crypto exchange, onboarding millions of investors in its original Monaco card project. Today, it thrives on offering discounted buys of crypto for its members. Members who participate in limited time offers can buy its own native CRO…
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Coinbase
Binance and Bitstamp, mentioned above, may take the plaudits for being the most accessible and the oldest, respectively. On the other hand, crypto exchange Coinbase does get a lot of visibility in the news in North America as a NASDAQ-listed company. More recently in the United Kingdom, as it has also been one of the…
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Bitstamp
Bitstamp is perhaps the most established crypto exchange on this list that supports taking. Founded in 2011, it is one of the original crypto exchanges still operating today. It is seen to be a favourite for veteran crypto professionals and financial institutions due to its experience and expertise. Because of this clientele, Bitstamp has a clean…
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Binance
Binance is one of the largest and most well-known crypto exchanges in the world, thanks largely in part to its global presence without an actual physical headquarters. Its focus on making the platform available to most countries also makes it one of the most accessible. One of the advantages of Binance compared to most rivals is…
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