Elys Network
  • Introduction
    • Overview
    • How it Works
    • Key Features
  • Getting Started
    • Quick Start Guide
  • Core Features
    • Swap
    • Earn
      • Simple Staking
      • Liquidity Mining
    • Perpetuals
    • Leverage LP
  • Tokenomic and Rewards system
    • Tokenomics
    • ELYS: The All-In-One Token
    • EDEN & EDEN Boost
  • GOVERNANCE
    • Elys Network Governors
    • Governor Foundation Delegation Program
  • Developer Resources
    • Elys Network Validators
      • Initial System Setup
      • Installing Elys Node
        • Validator Creation
        • Launch the Node
      • Additional Considerations
      • Troubleshooting
    • Security
  • Social Links
    • Elys Network Socials
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  • Overview
  • How It Works
  • Variable Swap Prices
  • Weight Recovery Reward
  • Bonus Vault
  • Benefits of Smart-Shielded Pools
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  1. Core Features
  2. Earn

Liquidity Mining

PreviousSimple StakingNextPerpetuals

Last updated 6 months ago

Overview

Liquidity Mining on Elys Network allows users to earn rewards by contributing liquidity to designated pools.

By adding assets to the liquidity pools, users not only facilitate smoother and more efficient trading within the network but also earn a share of the fees generated by multiple features. Liquidity mining provides an opportunity for users to passively earn while supporting the growth and stability of Elys Network’s decentralized exchange.

How It Works

When users contribute liquidity to Elys Network, they deposit pairs or single sided tokens into a liquidity pool.

This pool serves as a reserve, allowing traders to swap tokens without depending on traditional order books, thereby minimizing slippage and enabling smooth trading experiences.

In return for their contribution, liquidity providers receive rewards from multiple features, which are distributed based on the amount of liquidity provided and the level of activity within the pool.

Elys Network offers two types of pools: classic AMM pools and Smart-Shielded Pools.

While classic AMM pools use a simple mechanism with a fixed 50:50 weight between each token, Smart-Shielded Pools feature a variable weight that adjusts according to market conditions. This makes them more efficient and reduces the risk of impermanent loss to nearly zero.

Variable Swap Prices

Unlike traditional Automated Market Makers (AMMs), the swap price on Elys Weighted Pools varies based on the pool's needs.

For example, in an BTC/USDC pool, if rebalancing requires a higher percentage of BTC, the fees for converting BTC to USDC will be low, and vice versa.

Weight Recovery Reward

When a swap or liquidity provider improves the weight and brings it closer to the target, both the swap fee and weight-breaking fee are reduced to 0. Additionally, an incentive bonus, known as the "Weight Recovery Reward" is provided from a "Bonus vault" specifically designed to reward users participating in the weight balance.

Bonus Vault

Our bonus Vault collects 10% of all swap fees and redistributes them to incentivized weight recovery.

Benefits of Smart-Shielded Pools

Elys Smart-Shielded Pools offer several advantages:

  • Accurate asset prices

  • Arbitrage opportunities for traders thanks to low swap fees and our Weight recovery Reward system

  • Very low swap fees with negligible price impact

For more information about the mechanism:

Click here