Impermanent Loss
By CoinGecko | Updated on Aug 12, 2021
Impermanent loss may occur when you provide liquidity to the AMMs. Impermanent loss is similar to measuring your opportunity cost of holding the token within the pools versus holding them in your wallet. Note: the loss is not realized until you remove your tokens from the liquidity pool. The higher the divergence between the value of holding your tokens in the pool and wallet, the higher is the impermanent loss.
Related Terms
Seed
A value used to initiate generation of pseudorandom number, ususally a string of 12 commen English words.
Venture Capital
capital (funds) that is invested in a company that needs a substantial pool of funds to initiate.
Graphical Processing Unit (GPU)
They are chips dedicated to graphics processing or floating point operations, allowing to lighten the workload of the processors during applications usage such as video games.
Derivatives Market
A market for derivatives which are instruments such as futures or options whose value is derived from an underlying asset.
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