What Is the Difference between Impermanent Loss and a Standard Market Loss on a Held Asset? ▴ Learn

What Is the Difference between Impermanent Loss and a Standard Market Loss on a Held Asset?

A standard market loss is a direct loss in the dollar value of an asset simply by holding it as its price falls. Impermanent loss is an opportunity cost: the difference in value between the portfolio if held in the AMM pool versus if the assets were simply held in a wallet.

IL can occur even if both tokens' dollar values have increased, as long as their ratio has diverged.

Define ‘Divergence Loss’ as an Alternative Term for Impermanent Loss

What Role Does Market Sentiment Play in the Perceived Opportunity Cost?

How Does the “Opportunity Cost” of Mining Relate to the Attacker’s Profit Motive?

Why Are Stablecoin Pools Less Susceptible to Significant Impermanent Loss?