How-to manual for LPing
DeFi and AMM How-To SKALE

How To LP On Ruby.Exchange


This is the second of a three-part blog about using Ruby.Exchange. This blog gives an overview of how to deposit liquidity into Ruby's pools to earn trading fees. The process for staking LP tokens to yield farm will be covered in the third post.

Read part 1: Bridging funds to the Europa SKALE Chain and Swapping tokens

There are two options for adding liquidity to Ruby's pools: XY=K pools, which pair a crypto token (RUBY, SKL, ETH, BTC, etc) against USDP, or Ruby's StableSwap 4Pool (USDP, USDC, USDT, Dai).

How To LP For XY=K Pools

Select Liquidity -> Pool from the main menu, and click Add Liquidity.

Select the token for which you want to provide liquidity, and the amount. The corresponding amount of USDP will be filled in automatically.

All XY=K pools use USDP as their base pair by default. You can swap USDT, USDC, or Dai for USDP using the StableSwap 4Pool, with very low slippage.

Click Confirm Adding Liquidity, and confirm the transaction with MetaMask. You will receive liquidity provider (LP) tokens corresponding to your share of the pool.

So long as your LP tokens are not locked in Ruby's farming contract, you can redeem them at any time. (Remember that when you remove liquidity, you will receive back your share of the pool, not the exact number of each token you deposited.)

Liquidity providers receive transaction fees totaling 0.25% of every trade placed on Ruby.Exchange. To earn additional yield farming rewards, you will need to lock your LP tokens in the farming contract (see below).

How To LP For The StableSwap 4Pool

Providing liquidity to the StableSwap pool is a similar process, with the difference that users can deposit one, two, three, or all four stablecoins to the 4Pool. Start by selecting Stable Pool from the Liquidity menu.

Users can deposit any amount of one or more of stablecoins into the pool.

However, if the pool is underbalanced for any given currency, it is advantageous for users to deposit that token, so they can benefit from positive slippage (essentially buying the overweight tokens at a discount).

In this case, the pool is slightly overbalanced for USDP and underbalanced for the other three stablecoins, so depositing any of these three will be better than depositing USDP (see the small Bonus, below).

Enter the amount(s) you want to provide and click Deposit.

Click Confirm Deposit. You will need to Approve every token that is being added, using MetaMask, with the process therefore requiring up to four approvals before final deposit and a final MetaMask confirmation.

As before, you will now hold StableSwap LP tokens that represent your share of the 4Pool. When you redeem these, you can opt to receive a your share as a single stablecoin, or a combination of all four.

LPs for the StableSwap receive 0.02% of the 0.04% fee charged on all swaps.

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