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RE: How do liquidity pools work?

in #tribes2 days ago

Thanks. What I mean is, as the person creating the liquidity pool, do I have to fund it all myself or do I get other people to put their funds the pool?

But wait... ignore my question, because I think I've figured it out....

I remember when I invested in the Zing liquidity pool, which is the only one I invested in, and I had no idea what I was doing, I invested a few times in the pool, and everytime I had to put both Zing and Hive in the pool, and every time the actual amount, or the relative price of the two differed. And when I eventually divested, it differed again. I think it's all coming together like jigsaw puzzle now.

Look forward to the next post. thanks!

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You got it correctly. With the pools that we have on hive, you always need to put in or pull out 50% of value in both coins. Since both coins evolve differently in price, you will always have a different ratio.