How to participate in the ABG liquidity pool? 

3rd May 2024

What is a Liquidity Pool?

A liquidity pool is a fundamental concept in decentralized finance (DeFi) that plays a crucial role in decentralized exchanges (DEXs) and automated market makers (AMMs). In simple terms, it's a pool of tokens locked in a smart contract, used to facilitate trading on a decentralized exchange.

Liquidity pools provide continuous liquidity for DEXs, enabling efficient and permissionless trading while also allowing users to earn fees by providing liquidity to the ecosystem. Liquidity providers help reduce price slippage by ensuring there are ample tokens available for trading. Reduced volatility can be beneficial for traders and users, potentially attracting more activity and liquidity.

Furthermore, liquidity provision can be a form of passive income, particularly in DeFi (Decentralized Finance) ecosystems where automated market maker protocols operate autonomously, continuously earning fees for liquidity providers.

What is Yield Farming?

Yield farming, also known as liquidity mining, is a strategy used in decentralized finance (DeFi) to incentivize users to provide liquidity to liquidity pools and other DeFi protocols. Yield farming has become a popular trend in the DeFi space, attracting users with the promise of high returns and innovative financial opportunities.

On the other hand, yield farming is a method for liquidity providers to earn additional rewards on top of the trading fees generated by liquidity pools. By staking their liquidity provider (LP) tokens obtained from providing liquidity, users can participate in yield farming protocols and receive rewards such as governance tokens, platform tokens, or other incentives.

How to participate in the ABG Liquidity Pool? 

ABG has created a MATIC/ABG liquidity pool on SushiSwap. To participate in the ABG liquidity pool, users need to stake or lock up their MATIC/ABG in a liquidity pool on SushiSwap. This involves committing your ABG/MATIC for a certain period of time to earn rewards and receive the exchange’s native Sushi token. In SushiSwap, you can potentially earn 2.3% per day.

By providing liquidity to a pool, you become an integral part of the ecosystem, potentially driving demand for the ABG token. Increased demand can lead to appreciation in the value of the project, offering capital gains to liquidity providers.

Why SushiSwap?

SushiSwap is a decentralized cryptocurrency exchange (DEX) built on the Ethereum blockchain. It's a prominent player in the decentralized finance (DeFi) space, offering users the ability to trade various tokens directly from their cryptocurrency wallets. SushiSwap has become a significant player in the DeFi ecosystem, offering users decentralized trading with high liquidity, incentives for liquidity providers, and community-driven governance.

SUSHI token is the native utility and governance token of the SushiSwap platform. SUSHI tokens incentivize liquidity provision and platform usage. 

Disclaimer: By participating in liquidity pools, users acknowledge and accept the risks. It's essential to exercise caution, perform due diligence, and seek advice from financial professionals before engaging in any liquidity provision activities.