Liquidity Pool

V3

In the new V3 trading system, liquidity will be managed in the form of non-fungible positions. While providing liquidity, liquidity providers will still earn a share of the trading fees.

When you add your tokens to a Liquidity Pool (LP), you will receive a liquidity provider token (LP token) and be able to share in the trading fees for that token pair.

Non-fungible liquidity positions

In V3, liquidity providers now have the ability to set the price range at which they wish to provide liquidity. Therefore, when you add your tokens to a liquidity pool in V3, you will create a new non-fungible liquidity position with unique settings such as price intervals.

In V3, liquidity tokens are in the form of LP (Liquidity Provider) tokens. Please note that these LP tokens are transferable and represent ownership of liquidity assets as well as the trading fees earned.

In V3, you can manually claim earnings on each position's detail page.

You can redeem your funds at any time by removing your liquidity.

Explanation of Effective Liquidity and Price Range:

In V3, liquidity providers can set their positions to provide liquidity only within specific price ranges. If the trading price exceeds this range, the liquidity position will become a single asset and enter an inactive state.

Positions outside the designated price range will not participate in trades and will not earn any trading fees.

Concentrated Liquidity:

In V3, because liquidity providers can concentrate their liquidity—meaning they provide liquidity only within specific price ranges—V3 can support larger-scale transactions with the same amount of liquidity funds.

This significantly increases the relative liquidity level compared to V2, and liquidity providers can earn more trading fees with the same amount of funds.

Earning Trading Fees:

After providing liquidity, you earn income in the form of trading fees when others use your liquidity pool for exchanges.

Every time someone makes a transaction (exchange) on Sun.io, a fee ranging from 0.01% to 0.1% of the transaction amount is charged, based on the fee tier of the V3 liquidity pool.

V2/V1

LP token

For example, if you deposit TRX and USDT into a liquidity pool, you will receive TRX-USDT LP tokens. The number of LP tokens you receive represents your share in the TRX-USDT liquidity pool. You can withdraw your funds at any time by removing your liquidity.

Earning Trading Fees:

Every time someone trades on Sun.io, for each transaction involving a V2/V1 liquidity pool (exchange), traders are charged a fee of 0.3%.

Impermanent Loss:

Providing liquidity is not without risk; you may face impermanent loss.