Learn to LP on DELTRA.

• In this topic
• explain what a blockchain is in plain terms
• explain what an address is
• explain what a transaction does and why it can't be undone

Everyone throws the word blockchain around like it's obvious what it means. It usually isn't, and most explanations either drown you in jargon or skip the one part that matters most for you: what happens when value moves from one place to another.

A blockchain is a shared list

Picture a list that says who owns what: this address has 2 ETH, that one has 500 of some token, and so on. Now picture thousands of separate computers spread around the world, each keeping an identical copy of that exact list, and each one checking every new addition against the copies everyone else has.

Nobody owns the list. No single company can edit it, delete a line from it, or lock you out of it. That network of computers, all keeping the same list in sync and agreeing on what gets added to it, is a blockchain.

That's the whole idea. Everything else you'll come across in this course, wallets, pools, trading, providing liquidity, is built on top of that one thing: a list that many computers keep in sync, that anyone can read, and that nobody can quietly change.

What an address is

To have something show up on that list, you need a place for it to sit. That place is called an address. An address is just a long string of letters and numbers, something like 0x7a3F...9c1D, and it works a bit like an account number. Anyone can send money to an address.

An address doesn't carry your name and doesn't know who you are. It's just a spot on the list. Whoever holds the key that controls a given address, more on what that means in the next topic, is the only one who can move what's sitting there.

What a transaction does

A transaction is an instruction: move this much, from this address, to that address. When you send someone crypto, you're not mailing a coin anywhere. You're telling the network to update the list, subtract from your address, add to theirs. Every computer keeping a copy checks that the instruction is valid, mainly, that you actually had enough to send, and then updates its own copy the same way.

Say your address has 3 ETH, and you send 1 ETH to a friend's address. The network checks that your address really has 3 ETH available, confirms the instruction, and updates both entries: yours drops to 2 ETH, your friend's goes up by 1 ETH.

Once that update goes through, it sits there permanently. That's also why sending to the wrong address is unforgiving. There's no button anywhere that reverses it, and no company you can call. Whoever holds that address now holds what you sent, whether they were the person you meant to send it to or not.

• In this topic
• explain what an EVM chain is and why Robinhood Chain uses ETH for gas
• explain what a gas fee is and why it changes with how busy the chain is
• install a wallet, create it, and back up the seed phrase

Skip either of these two things, a wallet, or a little ETH sitting in it, and you're stuck before you start. Here's why both are non-negotiable, and how to set them up.

What an EVM chain is

Ethereum was the first blockchain built to run more than simple sends. It runs small programs, called contracts, that can do things like swap one token for another or hold a shared pool of money for people to trade against. The Ethereum Virtual Machine, EVM, is the piece of software that runs those programs, and a growing number of other chains, including Robinhood Chain, are built to run that exact same machine.

That's what "EVM chain" means: a chain built the same way as Ethereum, using the same style of address and the same style of wallet, and able to run the same kind of programs. Because Robinhood Chain runs the EVM, it also does the one other thing every EVM chain does. It charges a fee for the computer work behind every transaction, called gas, and it charges that fee in its own native coin. On Robinhood Chain, that coin is ETH.

What a gas fee is

Every time you do something on the chain, a swap, a deposit, sending a token, the network has to do work to make it happen, and that work isn't free. The fee for that work is gas, and on any EVM chain it's paid in the chain's native coin, never in whatever token you're sending or trading. Send $500 of a stablecoin and you still need a small amount of ETH sitting in the wallet to pay for the transaction itself. A wallet holding $500 of a token and 0 ETH cannot move that $500 anywhere.

Gas isn't a fixed price either. It moves with how busy the chain is at any given moment. More people trying to transact at once means more competition for the same computing capacity, so the fee goes up. Fewer people trying means it drops back down. On Robinhood Chain a normal transaction usually costs a few cents.

Setting up a wallet

Two good options for an EVM wallet: MetaMask and Rabby. Both are browser extensions, both work on Robinhood Chain, and either is a fine place to start.

• go to metamask.io or rabby.io directly, typing the address in yourself rather than clicking a search result, and install the browser extension
• choose "create a new wallet" and set a password. That password only unlocks the extension on this device. It isn't the wallet itself
• write down the 12 or 24-word seed phrase the wallet shows you, on paper, in order, and store it somewhere private. The seed phrase is what actually controls the wallet. Anyone who has it can access everything in it, and there's no password reset or support line to call if you lose it or someone else gets it. Never type it into a website, a notes app, or a message to anyone

That's the whole setup. From here your wallet has an address on Robinhood Chain. It just needs some ETH in it before it can do anything, which is the next topic.

• In this topic
• bridge funds from an existing Solana wallet onto Robinhood Chain
• withdraw funds from a centralized exchange straight to an address on Robinhood Chain
• bridge in from another EVM chain such as Arbitrum One or Base

For most people getting started, whatever you're going to use on Robinhood Chain is currently sitting somewhere else, a Solana wallet, an exchange account, or another chain built the same way as Ethereum. Here's how each path works.

Coming from a Solana wallet

A lot of newcomers to crypto started on Solana. It's a different kind of blockchain from Robinhood Chain, which is an EVM chain, built the same way as Ethereum, so funds can't move directly between the two. Getting from a Solana wallet to Robinhood Chain means using a bridge, a service that takes your asset on Solana and delivers an equivalent asset to your address on Robinhood Chain.

The bridge for this is Relay, at relay.link/bridge/robinhood. Connect your Solana wallet on one side, provide your EVM wallet's address on the other, pick what you're sending and how much, and confirm. The bridge takes a few minutes and charges a small fee on top of whatever Solana and Robinhood Chain each charge for their own gas.

Send a small amount first, confirm it shows up in your wallet on Robinhood Chain, then send the rest.

Withdrawing straight from an exchange

If your funds are sitting on a centralized exchange, Coinbase and Binance are two common examples, you may not need a bridge at all. Exchanges let you withdraw directly to any address you give them, on whichever networks they support.

Open the withdrawal screen, pick the asset, and check the list of networks it offers. If Robinhood Chain is on that list, paste your Robinhood Chain address, confirm the network is set correctly, and withdraw. That's the whole path, one transaction and no bridge needed.

If Robinhood Chain isn't listed for that asset, withdraw on a network you can bridge from instead, Ethereum or one of the EVM chains covered next both work.

Whichever network you pick, check it twice before confirming. Your address is valid on every EVM chain, but a withdrawal sent on the wrong network doesn't arrive on Robinhood Chain. It arrives wherever you told the exchange to send it, and getting it back from there isn't certain.

Bridging from another EVM chain

If you already hold funds on an EVM chain such as Arbitrum One or Base, moving to Robinhood Chain uses the same kind of bridge as the Solana route above, except both sides are EVM chains, which is a more common and better-supported kind of bridge. Relay, at relay.link/bridge/robinhood, and Across, at across.to/?to=robinhood, both connect directly to Robinhood Chain. Connect your wallet, pick your source chain, Robinhood Chain as the destination, choose the asset and amount, and confirm. It typically lands within minutes.

The same habit applies here as everywhere else in this topic. Send a small amount first, confirm it landed, then move the rest.

• In this topic
• explain why a contract can't move your tokens without your permission first
• know the tradeoff between an unlimited approval and an exact one

Here's what that popup is, and why it shows up before the thing you meant to do.

Why the popup exists

On Robinhood Chain, and on any EVM chain, a contract, the piece of code running a swap, a pool, or anything else, can't just reach into your wallet and take your tokens. Every token has a rule built into it: nobody can move your balance unless you've specifically given them permission first. That permission is called an approval, and it's a separate transaction from whatever you're trying to do.

So using a token for the first time with a given app is usually two steps. Approve, then do the thing you actually came to do, swap, sell, or deposit. Native ETH skips this step entirely, since it moves directly rather than through that permission system. Only tokens go through it.

The popup itself usually shows three things: which token it wants to approve, which contract is asking for permission, called the spender, and how much it's asking to be able to move. Read those three lines before confirming.

Unlimited vs exact amount

When you approve a token, you're also setting a ceiling: how much that contract is allowed to move, now or later. Most wallets and apps default to asking for an unlimited amount, so you only approve that token once and never see the popup again for future swaps or deposits with that app.

That convenience has a cost. An unlimited approval means the contract can move your entire balance of that token at any point in the future, not just the amount you're using right now. If that contract ever has a bug, or its keys get compromised, everything you approved is exposed, not just what you deposited today. Most wallets, including MetaMask and Rabby, let you edit the amount in the approval popup before confirming. Setting it to the exact amount you're using right now is the safer option, and it costs a little more gas each time you need to approve again later. Unlimited is the convenient choice. Exact is the safer one. Either way, know you're making that choice every time the popup shows up, rather than clicking through it without reading.

Three things that trigger one

You'll see an approval popup in exactly three everyday situations on DELTRA and elsewhere:

• swapping a token for another one
• selling a token
• adding a token to a liquidity position

In every case the pattern is the same. The app needs permission to move your token before it can do the thing you asked for, so it asks first. Once you've approved an amount, you won't be asked again with that app until you run out of that allowance or revoke it yourself.

• In this topic
• describe the order book model and what it needs in order to work
• describe how a pool prices and fills a swap
• explain what a liquidity provider does and how they get paid

The order book model

Most traditional exchanges work off an order book. You list what you want to buy or sell, and at what price, and the exchange waits until someone else places a matching order on the other side. It works well when a lot of people are actively trading the same thing at once. It works badly when they aren't. A brand new token with no active buyers and sellers just sits there on an empty order book, and nothing trades.

The pool model

An automated market maker, AMM, skips the waiting entirely. Instead of matching two people, a pool holds a balance of two tokens in one contract, and it prices trades off its own balances rather than waiting for someone to agree to a price.

Say a pool holds some amount of ETH and some amount of a token. Divide one balance by the other and that ratio is the current price. Put one token into the pool and the pool's math hands you the other token out, based on that ratio. There's no matching step and no waiting for a counterparty, so the trade always fills instantly.

Here's the part that catches people out. The price isn't fixed while you trade. As you put more of one token in, the pool ends up with more of it and less of the other, so the ratio, the price, shifts as your trade goes through. Buy a token and the pool has less of it left, so the price for the next buyer goes up. Sell into the same pool and the reverse happens, the price goes down. Every trade moves the price a little, because every trade changes the two balances the price is calculated from.

A bigger pool moves less on the same trade, because the same amount going in or out is a smaller fraction of a bigger pile. That's why a pool with a small balance can swing wildly on an ordinary sized trade, while a deep pool barely notices it.

What a liquidity provider does

None of this works unless something is sitting in the pool to begin with. A liquidity provider, an LP, is someone who deposits both tokens into a pool so that trades have something to swap against. Deposit your tokens, and from that point on you're the other side of every trade that crosses the pool, whether you're watching or not.

In exchange, every trade that crosses the pool pays a small fee, and that fee gets split among everyone who has liquidity deposited, in proportion to how much of the pool is theirs. That fee is the entire reason to LP, you're getting paid for putting your tokens where trades can happen against them.

That's the idea at the level you need for now. Course 2 is where you learn to do this, picking a pool, sizing a position, and opening your first one on DELTRA.

• In this topic
• define TVL, DEX and liquidity pool
• define market cap, volume and volatility
• define slippage, price impact and impermanent loss
• explain what a contract address is and why it matters

Ten terms, one plain definition each. Keep this topic as a page to come back to.

The basics: DEX and liquidity pool

DEX. A decentralized exchange, a website or app where you trade tokens directly against a pool instead of through a company that holds your funds for you. DELTRA sits on top of DEX pools built on Uniswap.

Liquidity pool. A contract holding two tokens that people can trade against. Anyone can deposit into one as a liquidity provider, and anyone can trade against it.

Size: TVL and market cap

TVL. Total value locked, the dollar value of everything deposited in a pool, or across a whole chain. A single pool's TVL is just its own two token balances added together, it isn't the same as a token's total market value.

Market cap. A token's price multiplied by how many of it are currently in circulation. Two tokens can trade at the same price and have wildly different market caps if one has ten times the supply of the other.

Activity: volume and volatility

Volume. The dollar value traded through a pool over some window of time, usually shown for the last 5 minutes, 1 hour, or 24 hours. High 24-hour volume next to a quiet chart right now means most of that trading already happened, not that it's happening today.

Volatility. How much a token's price swings up and down over a given period. A stablecoin has close to zero volatility. A memecoin can move 1000% in an hour.

Trading costs: slippage, price impact and impermanent loss

Slippage. The difference between the price you expected when you started a trade and the price you actually get once it lands, caused by the pool or the wider market moving in between. Every swap screen lets you set a tolerance, the worst price you're willing to accept before the trade reverts instead of filling badly.

Price impact. How much your own trade moves the pool's price, purely from you buying or selling into it. A small trade against a deep pool barely moves it. The same trade against a shallow pool can move the price several percent.

Impermanent loss. What happens to a liquidity provider's deposit as the pool rebalances it while price moves. As a token rises, the pool sells some of it out of your position. As it falls, the pool buys more of it into your position. This gets a full topic of its own later on, for now just the name and the shape of it matter.

Identity: contract address

Contract address. The actual, unchangeable identity of a token on the chain, a string starting with 0x. Anyone can name a token whatever they like, so the ticker and the logo can be copied by someone else. The contract address can't be copied the same way, which makes it the only thing worth trusting when you're confirming a token is the one you think it is.

• In this topic
• pull up every pool DELTRA lists for a given coin, not just the first one
• explain why two pools on the same pair can pay completely different rates
• use DELTRA's pool list and the lp-scans bot to compare them

Most people find a pool by typing a ticker into a search bar and clicking whatever loads first. On Robinhood Chain that habit costs money, because the same coin can sit in four or five different pools at once, and the one that loads first is rarely the one paying the best rate.

Where to look for them

Start on DexScreener or GMGN's trending tab, filter it down, then sort by 5-minute or 1-hour volume. From there, look for runners: coins actually pumping or pulling in real volume, not just sitting on a chart with nothing behind it.

Not every coin with volume is worth LPing. Volume gets manipulated constantly, and a spike can just be the setup for a rug. Do your own diligence before you put money into a pool against one, or you lose it, simple as that.

Why two pools on the same coin pay differently

A pool is one specific contract: one fee tier, one Uniswap version, its own reserves. A coin can have a 0.05% pool, a 0.3% pool and a 1% pool running at the same time against the same ETH or USDG, and they are not the same trade. One might hold $2,030,000 of TVL and pay out $76,400 in fees over 24 hours. Another, same coin, might hold $2,910,000 and pay out only $65,070. The bigger pool made less money for its LPs. Divide fees by TVL and you get 3.76% a day against 2.24% a day. Traders picked the lower-fee pool for most of their volume, so that's where the money is, even though it looks like the smaller pool on a market cap chart.

That's the number that matters: 24h fees divided by TVL, the daily rate a dollar of liquidity earned. A pool can have a huge TVL number and still be a worse place to put your money than a pool a tenth its size, if the smaller one is where the trading is happening.

The order to check, every time

• confirm the contract address against what the project itself posted, not just what a search result shows first
• open deltaliquidity.app/pools and search the coin or paste the contract address, so you see every pool that exists for it, not just one
• for each pool, write down the fee tier, TVL, 24h volume and 24h fees
• divide fees by TVL for each one. That's the daily rate. Ignore anything labeled as an annualized percentage until you've done this division yourself
• paste the contract address into the bot in the DELTRA Discord's lp-scans channel. It returns market cap, total liquidity, volume and holders for the coin, then a row per pool: fee tier, TVL, 24h fees, 5-minute volume and a rate estimate
• cross-check on Dexscreener for anything DELTRA doesn't list yet. DELTRA shows pools that already exist on chain. It doesn't create them, so a brand new pool can take a little time to show up

DELTRA's pool list is the fastest way to see fee tier, TVL and 24h fees side by side for every pool on a pair, which is the whole comparison in one screen. The lp-scans bot adds the same numbers plus a 5-minute volume figure, useful for telling whether a pool's daily number is a habit or something that happened once yesterday and stopped.

What decides which pool to pick

Higher fee tier does not mean higher pay. A 1% pool sitting mostly empty because traders route around it pays nothing. A 0.05% pool carrying most of the coin's real volume pays more per dollar than a 1% pool with a tenth of the traffic, and the fees-over-TVL division from the last section is the only way to see that before you deposit.

Size matters on top of rate. A $50,000 deposit into a $60,000 pool doesn't earn the rate the pool showed yesterday, because your own money changes the denominator. Redo the fees-over-TVL division with your deposit added to the TVL side before you commit anything meaningful. On a small pool the difference between the headline rate and your actual rate can be large.

And check that the volume is real before trusting the fee number at all. A pool with $600 of 24h fees on 9 transactions is not the same kind of pool as one with $600 on 400 transactions. Dexscreener's buy and sell counts for the pair, next to the pool's own numbers, tell you whether a lot of people are trading it or one wallet is.

• In this topic
• explain impermanent loss in plain language, with a real worked example
• explain when fees can offset it and when LPing beats just holding

Impermanent loss is the concept most beginners get wrong, and it's the most important one to actually understand.

When you LP, you're exposed to both assets in the pool, not just the one you started with. If price moves heavily in either direction, the pool automatically sells one asset into the other to keep the ratio balanced. This is how AMMs work.

Say you deposit $500 of tokens and $500 of ETH, $1,000 total. The token then pumps 50%. If you'd just held both separately, your token bag would now be worth $750, plus your $500 of ETH, $1,250 total. However, because you LP'd, the pool sold some of your token into ETH on the way up to keep you balanced. This would result in you ending up with something closer to $600 in tokens and $600 in ETH, $1,200 total. You're still up, you just made $50 less than if you'd done nothing. That $50 gap is impermanent loss.

Compared to just holding, you end up with less of the winner and more of the loser every time the price moves. However, fees earned can offset this, but that is only if trading volume is high enough relative to how far price has moved.

The case where LPing wins is when the token ranges, because you keep earning fees in both directions. Topic 2.5 on the three position shapes walks through exactly why.

This is the version of impermanent loss to carry into every position you open, not a number to memorize but a mental model. Assume some of your gains get sold off if the token trends hard in one direction, and check whether the fees you're collecting are enough to make up for it before deciding a position is worth holding.

• In this topic
• explain why an LP sometimes needs to swap before depositing rather than after
• describe what Uniswap, Matcha and KyberSwap each are and how the swap flow works on them

Why an LP ends up on a swap screen at all

Say you hold a stablecoin and want to open an ETH position. You need one specific asset in your wallet before DELTRA's builder will take it.

Uniswap

Uniswap is the AMM that DELTRA's own pools sit on top of, live on Robinhood Chain with v2, v3 and v4 all running. Using it directly is a plain swap: connect your wallet, pick the token you're selling and the token you want, and the app shows a quote, the rate, the fee tier the swap will route through, and the price impact your trade size causes. Review that quote, then confirm. Your wallet pops up asking you to sign, and once it confirms on chain you have the new asset. Uniswap is the one to reach for when you already know exactly which pool you want the swap to go through, since it's the same liquidity DELTRA itself builds positions on.

Matcha

Matcha is a swap aggregator, live on Robinhood Chain. Rather than routing you into one pool, an aggregator checks price across many pools and venues at once and splits or routes your trade to whichever combination gets you the best output. The flow looks almost identical to a plain DEX from your side: connect wallet, pick the tokens, review the quote, confirm. The difference is under the hood, where the aggregator is comparing multiple routes before it shows you one number. Worth checking when a pair might have several pools at different fee tiers or on different venues, since the best price for your specific trade size isn't always the pool with the most liquidity overall.

KyberSwap

KyberSwap is another aggregator, built the same way as Matcha in concept and also live on Robinhood Chain: it scans available liquidity and finds you a route, sometimes splitting one swap across several pools to reduce price impact on a larger trade. Connect, pick tokens, review the quote, confirm, same pattern again. The reason to have more than one aggregator open is simple: they don't always agree on the best route, and for anything beyond a small swap it costs nothing to check both before committing.

Reading the quote before you confirm

Whichever one you're using, three numbers matter before you sign. The rate, what you're getting per unit of what you're giving up. The fee, since every swap pays one, whether it's a flat pool fee or built into the quoted rate on an aggregator. And price impact, how much your own trade size is moving the price, which grows fast on a thin pool and barely registers on a deep one. A swap screen that shows a great rate but a large price impact number is telling you the trade is bigger than the liquidity underneath it wants to absorb quietly.

• In this topic
• walk through every step of opening a position on DELTRA, in order
• compare the risk of a two-sided deposit against depositing just one side of the pair
• explain what you're confirming when you sign the transaction and what it costs
• use a partial withdrawal to take money out of a position without closing it

Once you've found the coin and know which pool you want, it's time to build the position. Opening one on DELTRA is one screen with four decisions: which pool, what shape, what range, how big. Get the order right and it takes two minutes; get it backwards and you'll redo fields already filled in.

Step 1: pick the pool

Start from deltaliquidity.app/pools. If you've done the research earlier in this course, you know the specific pool, fee tier included, you're after. Its page shows every Uniswap pool for the pair, grouped by fee tier. Pick the one you researched, not the top row.

Step 2: pick a shape

Spot, Curve or Bid-Ask, covered in full in the next topic. If you're not sure yet, Spot has no opinion baked in: even liquidity across the whole range, a reasonable default while you're still learning the others.

Step 3: set the range

Type a minimum and maximum price, drag them on the chart, or flip the toggle to set the range as market cap instead. A wide range earns less per dollar but covers more movement; a narrow one earns more but gets left behind faster. It depends how much you expect the coin to move and how often you'll check on it.

Step 4: set bins and size

Bins slice your range into that many positions, up to 40. Each is a real mint on chain, so each costs gas that doesn't come back when you close. Spot with no reason to want more: bins set to 1 gets the same curve as 40, for a fraction of the gas. Bid-Ask needs more to form a real ladder, 8 to 15 is usually enough.

Sizing is two fields, one per asset, and what you put in each is a real decision, not just what's available. Pools want native ETH, not wrapped, so unwrap first if your wallet shows none.

There are three ways to deposit into a pool

Each shape carries a different risk.

Two-sided, token and ETH: deposit both and pick the range you expect the token to trade in. Dump below it and your ETH converts into the token as price falls through, so you hold more of what dropped. Pump above it and the pool sells your token into ETH, so you're fully in ETH and miss the rest of the move. If the token ranges and stays inside your band, this is where you earn the most fees.

One-sided, token only: deposit just the token, range above the current price. You earn fees once price rises into it, but pump straight through and you've already converted into ETH before it clears, missing the rest of the move. Price that never reaches your range earns nothing, you're just sitting in the token.

One-sided, ETH only: deposit just ETH, range set below the current price, a standing bid. Price dumping into your range means you accumulate the token and earn fees while it sits there. Best case is a dip that recovers, real fee volume on the round trip. Worst case it dumps through and keeps falling, leaving you holding the token at a loss.

There's no golden rule here. It depends on what you think the token does next, and that's the actual skill in LPing, not clicking deposit. Give yourself time watching charts before you size up.

Step 5: review and submit

The preview shows your final token split, bin count and what you're depositing.

Submitting is one transaction that mints your bins into a DELTRA contract holding the position, not your wallet; only the depositing wallet can claim or close it. You won't see it as a token in your wallet, which is expected. What you're confirming: tokens leaving your wallet, bins created on chain, gas paid in ETH per bin, roughly one swap's worth per bin.

Living with an open position

Once open, three things you can do without closing anything: claim fees, add more liquidity, or make a partial withdrawal. Claiming pulls accrued fees out and leaves the position running as it was, minus DELTRA's 1% cut.

A partial withdrawal works bin by bin: pick which of your position's bins to pull out, and the rest stay open under the same range and shape, still earning.

• In this topic
• explain Spot, Curve and Bid-Ask using bid, ask and spread language
• tell a one-sided position from a two-sided one and say what each holds
• pick a shape from a simple rule of thumb rather than a guess

A shape is just how your liquidity is spread across the range you set. Same range, same deposit, same pool, and the shape decides where inside that range your money is doing the work.

Spot: even, no opinion

Spot spreads your liquidity evenly from the bottom of the range to the top. Think of it as a flat wall of both bid and ask sitting at every price in the range, all the same size. Whichever price the market sits at, you're earning at the same rate you'd earn anywhere else in the range. It's the shape for when you genuinely don't know where inside your range price is going to spend its time and don't want to bet on it. That's a real, defensible position, not a lack of one.

Curve: piled up around today's price

Curve stacks most of your liquidity near the current price and tapers off toward the edges of the range. It's a concentrated bid and ask sitting right where trading is happening right now, with less further out. While price stays close to where it was when you opened the position, Curve earns more per dollar than Spot, because more of your liquidity is exactly where the trades are crossing. The cost shows up the moment price moves: because so much of your liquidity sat at the center, a move away from it converts a large share of your deposit fast, and by the time price reaches the edge of the range, Curve has paid the worst average price of the three shapes for whatever it ended up holding. Curve is a bet that price stays roughly where it is.

Bid-Ask: piled up at the edges

Bid-Ask does the opposite of Curve. It puts the least liquidity at the current price and the most at the far edges of the range, like a market maker's resting bid and ask sitting well away from the last trade, waiting for price to travel to them. While price sits still near where you opened, Bid-Ask earns almost nothing, because almost none of your liquidity is where the trading is. When price actually moves and reaches those edges, that's where the bulk of your liquidity finally goes to work. Bid-Ask is a bet on movement, not on price staying put, and it rewards you for being patient while nothing happens.

One-sided versus two-sided

All three shapes can be built two ways. Two-sided means your range straddles the current price, so you're holding both tokens across it, buying and selling as price moves in either direction. One-sided means your entire range sits on one side of the current price. Set your whole range below the current price using only the quote asset, USDG for example, and you hold nothing until price falls into your range, at which point it buys the coin for you as price drops, rung by rung. Set your whole range above the current price using only the coin, and it sells that coin back into quote as price rises into it. A one-sided position is effectively a limit order that pays you fees while it waits to fill, rather than sitting idle.

The rule of thumb

If you have no view on where price is headed and just want to earn while it's active, use Spot. If you expect the price to hold roughly still, a stable pair, a coin that's been range-bound for a while, use Curve, and accept that a real move against you converts a lot of your position fast. If you expect the price to travel, in either direction, and want to be paid more the further it goes, use Bid-Ask. And if you already have a specific level in mind, a price you'd be happy buying at or a price you'd be happy selling into, a one-sided position on that side of the market does the job on its own, without needing a two-sided range at all.

None of these are permanent choices. On DELTRA, moving from one shape or range to another means closing the position and opening a new one, so the shape you pick at the start is the one you're living with until you decide it's worth the gas to change it.

• In this topic
• decide between a concentrated range and a wider one for a given situation
• explain fees outearning impermanent loss as the first way LPs profit
• explain positive divergent loss as the second way, with a worked example

A tighter range earns more fees per dollar while price is inside it. A wider range earns less per dollar but stays inside for longer. Neither fact tells you which one to pick. That depends on how much attention you're planning to give the position and how much the coin is likely to move while you're not looking.

When to go concentrated

A concentrated range makes sense when you expect price to hold roughly still, and when you're checking on the position often enough to react if it doesn't. A stablecoin pair sitting near $1.00, a coin that's been range-bound for a stretch, a position you're planning to watch for a few hours and adjust: these are where a tight range earns its keep, because the odds of price leaving it before you notice are low.

When to go wider

A wider range makes sense whenever you can't watch the position closely, when the coin has a history of moving fast, or when the cost of rebuilding the position, gas on every bin, plus whatever you'd pay to swap back to your target mix, isn't worth paying every time price ticks outside a tight band. A position you're opening and leaving alone for a week or more should almost always be wider than one you're sitting in front of. The tradeoff is lower fee income per dollar while it's active, in exchange for staying active through a much bigger move.

The first way LPs profit: fees beating the drift

The mechanism most people already understand is this one: every trade that crosses your liquidity pays a fee, and if the fees you collect over the life of the position are bigger than the value you gave up to price moving against your original mix, you come out ahead. That's the whole calculation. A range that captures a lot of trading volume relative to how much it moves against you is a good bet. A range that earns thin fees while getting fully converted into the losing side of a big move is a bad one. Nothing exotic here, it's the same tradeoff covered earlier in this course, just restated as the plain question every position should answer: did fees outearn the drift.

The second way: positive divergent loss

A pool's mechanism doesn't just sell your winner and buy your loser as an abstract cost. It's reacting to whichever direction price moves, and that direction isn't something the pool decides. If price moves the way you wanted, that same mechanism becomes the thing that makes you money, on top of fees.

Say ETH is at $2,000 and you want to build a bigger position without timing the bottom. You deposit $1,000 into a two-sided range, split 0.25 ETH and $500 USDG. Price falls to $1,500 and stays there. Along the way, the position spends your USDG buying ETH at every price it passes through, ending up holding about 0.35 ETH. A single upfront buy of that same $500 at $2,000 would only have gotten you 0.25 more ETH, for 0.50 ETH total. Against a 50/50 holder, this looks like the standard impermanent loss from earlier in this course. But you were never trying to be a 50/50 holder, you wanted ETH bought cheaper over time, and that's exactly what happened, plus fees the whole way down.

The same works in reverse: if you'd rather end up holding more USDG, a position that sells your ETH into USDG as price rises is doing exactly what you wanted, and getting paid fees to do it. This is positive divergent loss: drift away from your original mix that the impermanent loss formula treats as a cost, working in your favor because it moved you toward the asset you actually wanted more of. It only works when you genuinely have a preference for one side. With no view, drift in either direction is just a cost, and you're back to needing fees to outearn it.

• In this topic
• decide a mental stop before funding a position, and take it the day it's hit
• size a position by how well the token cleared the checklist, not by conviction
• run the coin-selection checklist every time, GMGN, top-holder concentration, bubble maps, locked liquidity
• treat fee income as compensation for the risk taken, not a bonus on top of it

Most people who lose money LPing did not get rugged. They funded a real, unlocked, ordinary token, sized it like it was a sure thing, and had no plan for what they'd do if it went the wrong way. Checking for rugs catches one failure mode. It does nothing about the other three.

Decide the exit before you fund it

The only time to decide what makes you wrong is before you're in the position, not after it's down and you're negotiating with yourself. Before funding, pick the one thing that gets you out, a price level, a holder-concentration change, liquidity getting pulled, whatever fits the token, and write it down somewhere you'll see it again. When that thing happens, close the position or size it down that day. "Let's see if it recovers first" is how a plan becomes a hope. A stop you don't take when it's hit was never a stop.

Size the position to the risk, not to how much you believe in it

Conviction is not a risk control, position size is. How much you put into a position should track how well the token cleared the checklist below, not how good the chart looks. A rough way to run it:

• top-10 concentration under 10%, on a token that's traded for a while: a normal-size position for you
• concentration in the 10% to 25% range: half that, or less, since a wallet that size can move price on its own
• a cluster over 25% to 30%, or a token too new to have real numbers yet: whatever you'd be fine losing outright, or skip it

The checklist doesn't tell you whether to fund something. It tells you how much.

The coin-selection checklist

Paste the contract into GMGN before anything else. It pulls market cap, liquidity, holder count and a security scan onto one screen. Three numbers matter most: pool age, holder count, and what percentage the top wallets control, excluding the pool itself and any genuinely locked contract. Under 10% in the top 10 is normal for a token that's traded a while. Above that, the sizing rule above applies. A "deployer" label is not the same thing as a locked wallet, GMGN won't confirm that distinction for you.

Bubblemaps is the second stop. A holder list shows individual wallets, a bubble map shows which ones are actually the same seller, drawn as a cluster around a shared funding source. Sum a cluster and run it through the same thresholds as a single wallet, six addresses holding 27% of supply between them is one seller with 27%, not six people who like the same token.

Locked liquidity is real protection against exactly one thing: the pool's own assets being pulled out. It does nothing about a wallet selling its supply into that pool as an ordinary swap, the lock and the sale are unrelated mechanisms. A token falling 40% because a large holder sold into volume is a dump, not a rug, and it happens to real tokens constantly. A token falling 40% because one wallet held a third of supply from day one and sold the moment anyone showed up is the failure the checklist above exists to catch, and the locked badge on the pool page told you nothing about it either way.

Fees are the payment for the risk, not a bonus on it

Everything above controls how much you can lose. Fees are the other side of it, what you're paid for carrying that risk while you wait. A position that clears the checklist and gets sized correctly but sits in a pool with no real volume is still a bet with a real downside and close to nothing coming back for holding it. Before funding, check that the pool's volume and fee tier can plausibly pay you something over the time you're planning to hold, the same fees-outearning-drift math from earlier in this course. A clean checklist result is not a reason to skip that check, it just means the risk you're being paid for is the ordinary kind instead of the rug kind.

• In this topic
• claim fees and redeposit them, or fold them into your next rebalance, and know which one makes sense
• decide when compounding is worth the gas it costs
• pull up a position's PnL card on the DELTRA website and read every number on it

Unclaimed fees sitting on a position card feel like progress because the number only goes up. It does not do anything for you until you either take it out or put it back to work, and on DELTRA those are two different clicks with two different costs.

How compounding works on DELTRA

A Pool has an add-liquidity button. Fees accrue separately from your liquidity, in whichever token the trader paid, and they sit there until you claim. Compounding means claiming that accrued amount and depositing it again.

When it is worth the gas

Compounding is worth doing when the fees you are redepositing are a clear multiple of what the redeposit costs in gas, not a rough multiple. Say a position is earning $2 a day in fees. Claiming it and paying $0.50 of gas to mint a new position spends 25% of what you just earned on the transaction that moved it. The same $0.50 against a position earning $40 a day is 1.25%. The gas cost does not care how big your position is. The fees do.

Your PnL card

Every position on deltaliquidity.app has a PnL card, and it is the one screen built to answer a single question honestly: did this work. Open the position from your dashboard and pull up its card. It shows what you deposited, what the position is worth right now, fees claimed plus fees still unclaimed, and the net result against your deposit. It is also shareable, built to be screenshotted and posted, which is exactly what the write-ups in the DELTRA Discord use.

Read it in that order every time. Deposit tells you the baseline. Current value tells you what the pool did to your mix of assets. Net is the only number that matters for whether the position worked, and a position can show a green fees number while still landing net negative, if the token side fell further than the fees covered.

One last thing

That is the whole academy. Everything from here is the same checklist, run more times, on different tokens, with different numbers attached. Read the pool, check the wallets, size it, watch it, decide, write it down.

The rest of this happens in the DELTRA Discord. General is where people actually talk, ask what a chart is doing, and admit when a position went badly. Lp-scans is where you paste a contract and watch the bot pull the same numbers you just spent three courses learning to read yourself. The volume alert channels are where you will see the next one before anyone posts about it anywhere else.

Bring a position, a question, or a loss you want a second opinion on. All three get read there.

See you on DELTRA.