{"id":1519,"date":"2020-09-23T15:12:06","date_gmt":"2020-09-23T15:12:06","guid":{"rendered":"https:\/\/de.fi\/blog\/?p=1519"},"modified":"2023-07-17T16:59:16","modified_gmt":"2023-07-17T16:59:16","slug":"what-is-a-liquidity-provider-742d471ad4d2","status":"publish","type":"post","link":"https:\/\/de.fi\/blog\/what-is-a-liquidity-provider-742d471ad4d2","title":{"rendered":"What is a liquidity provider?"},"content":{"rendered":"<p>A liquidity provider is someone who provides assets (liquidity) to a pool of funds. The more liquidity provided to a pool, the less slippage there is on a trade and the better the price discovery. By providing liquidity to Uniswap, the liquidity provider is rewarded by receiving a share of the fees earned in that pool proportional to the liquidity provided. This is one of the simplest and lowest risk forms of yield farming on Ethereum.<\/p>\n<p>You might be interested to also see the following guides:<\/p>\n<ul>\n<li><a href=\"https:\/\/dedotfi-guides.medium.com\/introducing-defi-yield-50dd54b869d3\">Introducing De.Fi<\/a><\/li>\n<li><a href=\"https:\/\/de.fi\/blog\/what-is-defi-1b2a45813851\">What is DeFi?<\/a><\/li>\n<li><a href=\"https:\/\/de.fi\/blog\/what-are-pools-2aa3c0825259\">What are pools?<\/a><\/li>\n<li><a href=\"https:\/\/de.fi\/blog\/what-to-consider-before-farming-yield-cd18af1de724\">What to consider before farming yield?<\/a><\/li>\n<li><a href=\"https:\/\/de.fi\/blog\/what-is-yield-farming-d20581814901\">What is yield farming?<\/a><\/li>\n<li><a href=\"https:\/\/de.fi\/blog\/what-is-total-value-locked-tvl-583d85ad8ba2\">What is Total Value Locked (TVL)?<\/a><\/li>\n<li><a href=\"https:\/\/de.fi\/blog\/what-is-the-annual-percentage-yield-apy-d485120e52c3\">What Is the Annual Percentage Yield (APY)?<\/a><\/li>\n<li><a href=\"https:\/\/de.fi\/blog\/the-rewards-paid-out-by-any-of-the-various-defi-applications-for-joining-pools-and-becoming-a-b6ae77080070\">What is liquidity mining?<\/a><\/li>\n<li><a href=\"https:\/\/de.fi\/blog\/what-is-composability-10b0e3c4cbb\">What is composability?<\/a><\/li>\n<li><a href=\"https:\/\/de.fi\/blog\/stablecoins-are-digital-assets-pegged-to-the-value-of-fiat-currencies-like-the-dollar-or-the-euro-a885fb41b612\">What is a stablecoin?<\/a><\/li>\n<li><a href=\"https:\/\/de.fi\/blog\/what-is-a-liquidity-provider-742d471ad4d2\">What is a liquidity provider?<\/a><\/li>\n<li><a href=\"https:\/\/de.fi\/blog\/what-are-the-potential-use-cases-for-defi-c353b8fef235\">What are the potential use cases for DeFi?<\/a><\/li>\n<li><a href=\"https:\/\/dedotfi-guides.medium.com\/how-to-avoid-getting-rekt-with-yield-farming-7e558ce08ea1\">How to avoid getting Rekt with Yield Farming<\/a><\/li>\n<li><a href=\"https:\/\/dedotfi-guides.medium.com\/why-impermanent-loss-calculators-are-wrong-and-how-to-avoid-incorrect-assessment-of-the-money-waste-d349607706fc\">Why Are You Miscalculating Your Impermanent Loss And How To Stop Doing It<\/a><\/li>\n<\/ul>\n<p><a href=\"https:\/\/t.me\/DeDotFi\">Join the De.Fi Telegram channel<\/a><br \/>\n<a href=\"https:\/\/twitter.com\/DeDotFi\">Follow De.Fi on Twitter<\/a><br \/>\n<a href=\"https:\/\/de.fi\/blog\/\">Read the De.Fi guides on Medium<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>A liquidity provider is someone who provides assets (liquidity) to a pool of funds. The more liquidity provided to a pool, the less slippage there is on a trade and the better the price discovery.<\/p>\n","protected":false},"author":3,"featured_media":3758,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9],"tags":[7,31,19],"class_list":["post-1519","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-defi","tag-defi","tag-what-is","tag-yield-farming"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.10 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>What is a liquidity provider?<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/de.fi\/blog\/what-is-a-liquidity-provider-742d471ad4d2\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What is a liquidity provider?\" \/>\n<meta property=\"og:description\" content=\"A liquidity provider is someone who provides assets (liquidity) to a pool of funds. 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