Claim Fee Rewards
Last updated
Last updated
In early or classic versions of AMMs (Automated Market Makers), the handling of transaction fees is usually quite straightforward:
Fees Accumulate in the Pool: When a trader executes a trade in a V1/V2/Curve pool, they pay a fixed percentage transaction fee (e.g., 0.3%). This fee (typically in the form of the two tokens in the trading pair) is directly added back into the liquidity pool.
LP Token Value Growth: The LP tokens you receive represent your share of the total assets within the pool. As transaction fees are continuously added back into the pool, its total value increases (ignoring the effects of impermanent loss). Consequently, the value of the underlying assets represented by each LP token you hold also grows automatically.
How to "Collect" Rewards:
Primary Method - Removing Liquidity: Under the V1/V2/Curve model, you generally don't perform a separate "claim fees" action. When you decide to remove your liquidity, you redeem a corresponding proportion of the pool's assets based on your share of LP tokens. The assets redeemed at this point naturally include the portion of transaction fees that accumulated while you were providing liquidity. Your earnings are reflected in the increased quantity or value of the tokens you withdraw compared to your initial deposit (again, considering impermanent loss).
Operational Steps:
Click "Trade" -> "SunSwap" to enter the SunSwap page. Click the "V1" or "V2" tab.
For Curve pool operations, refer to How to Withdraw Stablecoin Pool Liquidity?
If you hold relevant liquidity, you can view all your positions listed at the bottom of the page. Click the 'Remove' button to proceed to the remove liquidity page.
Select the percentage of liquidity you want to remove, then click the 'Remove' button.
Click 'Confirm Remove' and sign the transaction in your wallet. After signing, the collected rewards will be sent to your personal wallet, and simultaneously, the reward value and token quantity on the liquidity details page will be updated to the latest values. Your earnings are reflected in the increased quantity or value of the tokens you withdraw compared to your initial deposit (impermanent loss should also be considered)
The V3 protocol introduces the concept of Concentrated Liquidity, which fundamentally changes how fees are collected:
Fees Accumulate Separately: In V3, when you provide liquidity, you need to specify a price range. Your liquidity only becomes active and earns fees when the pool's current trading price falls within the range you set. Crucially, these earned fees do not automatically compound back into your liquidity Position. They accumulate independently, separate from your principal capital.
How to "Collect" Rewards - Active Claiming:
Requires Manual Action: Since fees accumulate separately, you must actively and explicitly claim them.
Interface: Rewards can be collected on the liquidity details page. A "Collect" button will be displayed if rewards are available; if there are no rewards to collect, the "Collect" button will not be shown.
Click "Collect" and a "Confirm Collect" pop-up will appear, displaying the amount of rewards to be collected.
Click "Confirm Collect", and a pop-up will appear requesting your signature. Once signing this action, you will see a "Reward Collected" message. The rewards will be sent to your wallet, and the remaining reward amount will be shown on the page with pool details.
Frequency: You can claim accumulated fees at any time based on your needs, but Gas costs should be considered. The more fees accumulated before claiming, the lower the Gas cost relative to the amount claimed.
No Auto-compounding of Fees: Fees claimed to your wallet are not automatically reinvested into your liquidity position. If you wish to compound your earnings, you need to manually add these claimed tokens back to an existing position (if allowed) or create a new position.
V1/V2/Curve
Transaction fees automatically compound into the liquidity pool, increasing the intrinsic value of LP tokens.
The primary way to "collect" fees is by withdrawing them along with your liquidity when removing it.
If participating in liquidity mining, additional rewards require manual claiming.
V3
Transaction fees do not automatically compound into your liquidity position's principal; instead, they accumulate separately.
You need to actively access your V3 liquidity position management interface.
You manually initiate a transaction by clicking the "Collect" button to withdraw accumulated fees to your wallet.
Claimed fees must be manually reinvested to achieve compounding.
Key Differences:
V1/V2: Fees are passively accumulated and included in the LP token value (realized mainly upon liquidity removal).
V3: Fees are actively managed and require users to periodically perform a manual "Collect" action to receive the fee income into their wallet.
