What Is Liquidity provider?

Liquidity providers (LPs) are users that deposit their assets to the liquidity pools of an Automated Market Maker (AMM).

Liquidity providers are crowdsourced collections of crypto assets used by the AMM to trade with people buying or selling one of these assets. AMMs use pre-programmed mathematical equations to adjust prices based on supply in order to make sure the ratio of assets in any liquidity pool is maintained.

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