Is the Impermanent Loss Calculation Different for a Stablecoin Pair Compared to a Volatile Pair?

The fundamental calculation for impermanent loss (IL) remains the same: it is the difference in value between holding the assets and providing liquidity. However, the magnitude of the potential IL is vastly different.

Since stablecoin pairs are designed to have minimal price divergence, the IL calculation typically yields a much smaller number. The formulas used for stablecoin pools (hybrid/stableswap) also modify the price curve to reduce IL within the peg range, making the calculation more complex in practice.