Skip to main content
Learn

What Is ‘Impermanent Loss’ in the Context of a Fungible Token Liquidity Pool?

The temporary value loss from a price ratio change between two pooled tokens, realized as permanent upon withdrawal.
Greeks.Live16.11.25

What Is ‘Impermanent Loss’ in the Context of a Fungible Token Liquidity Pool?

Impermanent loss is the temporary divergence in value between holding tokens in an Automated Market Maker (AMM) liquidity pool versus simply holding them in a wallet. It occurs when the price ratio of the pooled tokens changes after a deposit.

The loss is "impermanent" because it is recovered if the tokens return to their original deposited price ratio, but it becomes permanent upon withdrawal.

Explain the Concept of ‘Impermanent Loss’ in Liquidity Provision
What Is the Risk Associated with Impermanent Loss in Decentralized Finance (DeFi) Liquidity Pools?
What Is the Primary Difference between Fungible and Non-Fungible Tokens?
Explain the Concept of “Impermanent Loss” in Decentralized Finance (DeFi) Liquidity Pools

About

Contact

Editorial Policy

Terms of Service

Privacy Policy

Cookie Policy

© 2025 Greeks.Live

All Rights Reserved

Greeks.Live RFQ

Build by Noo on Engine

Source: The content on this website is produced by Greeks.live's proprietary analysis systems, which utilize advanced Large Language Models (LLMs). This information might not be subject to a full human review before publication and may contain errors.
Responsibility: You should not make any financial decisions based solely on the content presented here. We strongly urge you to conduct your own rigorous due diligence and to consult a qualified, independent financial advisor.
Purpose: All information is intended for informational purposes only. It should not be construed as financial, investment, trading, or any other form of professional advice. News and data are not trading signals.
Risk: The cryptocurrency, derivatives, and options markets are highly volatile and carry significant risk. By using this site, you acknowledge these risks and agree that Greeks.live and its affiliates are not responsible for any financial losses you may incur.