What Is the Maximum Theoretical Impermanent Loss in a 50/50 Pool If One Token’s Price Drops to Zero?

The maximum theoretical impermanent loss is 100% of the value of the token that drops to zero, relative to the value of holding the initial assets. If Token A's price drops to zero, the pool's AMM formula forces all of the remaining Token B to be sold for near-worthless Token A. The LP's position will convert entirely to Token A, resulting in a total loss of the value of the initial Token B holding.