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In What Scenario Is Impermanent Loss Actually Realized as a Permanent Loss for the Liquidity Provider?

The loss is realized upon withdrawal if the price ratio has not recovered, and it is permanent if fees earned do not cover the divergence.
Greeks.Live21.11.25

In What Scenario Is Impermanent Loss Actually Realized as a Permanent Loss for the Liquidity Provider?

Impermanent loss becomes a permanent loss for the liquidity provider (LP) upon withdrawal of the liquidity. If the LP withdraws their assets when the price ratio has not returned to the initial deposit ratio, the loss is realized.

Furthermore, the loss is permanent if the accrued trading fees earned by the LP are less than the impermanent loss incurred. If the fees outweigh the impermanent loss, the LP still profits overall, but the "loss" component relative to holding is still realized.

What Is the Difference between Impermanent Loss and Transaction Fee Income for a Liquidity Provider?
Why Is the Loss Considered “Impermanent” before Withdrawal?
What Is ‘Impermanent Loss’ in the Context of Decentralized Finance (DeFi) Liquidity Pools?
Can a Liquidity Provider Experience a Net Loss Even with Trading Fees Earned, Due to Impermanent Loss?

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