@bmjc98
edited
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How I Lost 73K $CATS And 37 $EBEN In LP I don't know how to write this article, but I will try my best to share with you my 18-day journey in staking my LP tokens, and how I lost more than 50% of them. Before anything else, let me explain what is a Liquidity Pool in my own understanding.
Liquidity Pools or LP are paired crypto assets, in my case, EBEN-BCH and CATS-BCH, that are pooled together to earn a certain token, which is EBEN. Since I'm not into technical stuff, I highly recommend you to DO YOUR OWN RESEARCH or better yet read this article to know more about LP: **Liquidity Pools 101 - How NOT to Lose Money** https://www.publish0x.com/gabriel/liquidity-pools-101-how-not-to-lose-money-xlyngxz Feel free to read this: **Full-Detailed BenSwap Tutorial (TagLish Edition)** https://read.cash/@bmjc98/full-detailed-benswap-tutorial-taglish-edition-1a20f4ba 18-day journey in LP So August 30, I added 100K CATS and 0.0269 BCH into the LP. I also swapped 0.011 BCH for 51.9 EBEN. The 51.9 EBEN was added to liquidity and an amount of 0.0109 BCH was also needed to complete the pair. Both LP tokens were staked in the hopes that I could earn more EBEN fast. 100K CATS - 0.0269 BCH 51.9 EBEN - 0.0109 BCH I had no idea about the risks until @Jane mentioned it to me in our TG group. PVM also said he doesn't like providing liquidity. According to him, **if APY/APR is high, you could lose**.
I was a bit worried but didn't bother to pull them out yet since at the back of my head, I could gain more profit once BCH hits $700. However, @francis105d1 also posted his reminder in our TG group that finally made up my mind to do something about it before I regret not pulling out on time. You should read this article, though: **A crash course to DeFi on Smart Bitcoin Cash.** https://read.cash/@francis105d1/a-crash-course-to-defi-on-smart-bitcoin-cash-93244661 Unstaking your LP tokens So yeah, after 18 days, I finally pulled out everything. So the process was simple, in case you want to unstake yours. I'm not saying you have to unstake it now. Just DYOR and ask the experts. Anyway, to unstake your LP tokens, here is the first step: Click the '-' sign under the LP token you want to unstake. After I unstaked my EBEN-BCH, I immediately checked my wallet to see if my assets were back. I was shocked when I couldn't see it. I almost got panic. So I explored the Liquidity page, and there I saw my token. So what's next? *If you want to pull out everything and have no plans to stake them back...* Hit Remove. Set the percentage bar to max. Confirm the transaction. Hit Approve, and then Remove button. Confirm. *Once the transaction is completed, you will then see your assets in your wallet.* Unfortunately, from the original **51.9 EBEN - 0.0109 BCH**, what's left for me is **14.4054 EBEN (plus 4 from the Harvest) and 0.0401133 BCH**. This means I lost 37.4946 EBEN and gain 0.0292133 in BCH.
I also pulled out my CATS-BCH. From the initial put-up of **100K CATS - 0.0269 BCH**, I now have 0.10494 in BCH but lesser CATS. Out of 100K, I lost 73,406.5 CATS, which means I only got 26593.5 left back to my wallet.
**How exactly did I lose my CATS and end up having more BCH?** As I've said earlier, LP requires two assets that need to be pooled together to earn a certain token. The goal is to keep the two assets' value linked with one another and must always remain constant. However, **if one asset increases its value**, an adjustment has to be made, **resulting in lowering the value of another**. So in my case, I have gained more in BCH but lost more than 50% of my EBEN and CATS. This means the price of BCH is high but the tokens are both low. Despite having more in BCH, I'm still saddened by the loss of my CATS and EBEN. Now, I only have 28593.53 CATS and 21.41721 EBEN left in my wallet.
So where did the risk comes from? As Francis said, providing liquidity can be very risky. Due to volatility, you may end up experiencing **impermanent loss** on the value of your pooled assets. You may also end up having more worthless tokens and less of your valuable ones if a rug pull occurs. This is why you must **DO YOUR OWN RESEARCH** first with the tokens you want to add into a Liquidity Pool to avoid such hassle and loss.
*Closing thoughts* Despite this quite unfortunate event for me, I'm happy that my BCH is secured now. Plus, from the initial investment of $47.65, now $142.03 in BCH + $60 that I added in WBCH. Most importantly, I gained something valuable, and that's the lesson I learned from staking in LP.
88 comments
Di jud ko makarelate ani sis..
Sis, naa ba kay Metamask? Naay daghan airdrop, sis. Pero since wa pa ka katry sa LP, ayaw na lang jud itry.
Naa nuy metamask sis unya naa na pud kuy arg, kitten ug candy. Pero di jud ko ana mutesting kay wala jud kuy understanding ana..
Ayan nga mahirap sa LP Kaya sakin purp stake lang.
Na try mo na to dati? Ngayon ko lang talaga na try. Kinabahan pa ako kasi akala ko nawala assets ko.
The general idea is this one "providing liquidity can be very risky. Due to volatility, you may end up experiencing impermanent loss on the value of your pooled assets." Im happy its going well for you, because when I read the tittle, I start criying.
HEHEHE. Still, not totally well, though. 73k CATS? :( 37 EBEN? :(
Of corse, you could lose everything! At least you almost tripled your BCH. :) Of evil, the least
Have you tried this one before?
I have not tried. I have friends who do it, some have done well, others better not even tell you. I am a bit isolated because I have lost money and I have rethought what to do with it a thousand times before acting.
Aww..sayang din po yung loss na Eben marami din yun..but atleast po you gained something .. Nako..buti di ako nag stake ng madami..diko pa pala nacheck cats ko..patay
Itry mo daw icheck kasi baka nasobrahan lang ako sa ka panic. HAHAHA. Try mo to, please. Kung me LP ka lang. Punta ka liquidity at let me know kung me asset ka ba dun? Di ko kasi na explore yung liquidity after ako ang add ng assets.
I was expecting that you'll lost BCH and gain EBEN since it was the reward 😅 .. It was the opposite in your case maybe because the EBEN and CATS price dropped when you unstake them...
So good pa rin ba? Nalungkot ako sa CATS ko. HAHAHA. Bili na lang ako pag nag dip. Pero at least, hindi ako nalugi. Yun ang importante.
Not for me. Kc malaki value nyang 73k+ CATS 🤣 at EBEN compare dun sa nakuha mo na profit
Hahahaha. Yun nga talaga iniisip ko. Hayst. Wag mo na ipaalala. 🤣🤣🤣🤣
I tried providing liquidity on another network last year. I was in loss so I guess that was my first and last doing that. I don't like it anyway. If you want to do that find stabe coin pairs like usdt/dai. The percentage is less, but they don't lose value.
You mean a token + USDT? Well, at least, I'm not alone in this journey. HEHE. And yeah, this would be my first and last. Better stake then and forget about LP.
Lesson and learn na rin ate sa lahat, thankyou po sa paalala.
Oo. Since maraming me CATS, mas okay iHODL na lang.
Not bad having 0.10BCH from 0.02, you should be grateful because BCH is valuable than CATS hehe but for EBEN it's a bit painful. That's why I didn't made LP, we reminded all of you in the beginning but at least you didn't lose BCH that's more saddening. Don't regret experience, it's a great lesson.
I did the LP way before you mentioned it. HAHA. During the first day when the staking is live. I did it in the hopes to earn more EBEN. But yeah, at least my BCH is safe. And sometimes, we have to learn the hard way. LOL. At least alam ko na kung anung difference nila.
Kaya ako hanggang pool lang eeh kasi laging sabi nina Jane at Eyb na it's very risky. Buti sana if ang ka pair is stable coin kaso mo walang available non sa benswap. Pero naka gain kapa rin naman ng BCH not bad na rin ano. Basta wag na basta basta maga farm aguyy.
Oo. Ang alam ko narinig ko na to dati kay Laurenceuuu pero yun nga minsan talaga kaka explore, kung saan saan na napapadpad. At least, BCH is fine at me na learn din ako. HAHAH. Sige lang part of growing to sa crypto journey ko. At least nakapag share na rin ako ng experience ko so hopefully yung iba, matuto rin para di nila to ma experience.
Yayy, another experience lang naman areh more exploration to come pa hihi
Now i have a little idea about what LP and how it works haha ayoko pa sya itry hehez. Atleast po you've learn a lesson naman better luck next time
Oo. Ana na lang jud. If you have tokens, ihodl na lang or buy and sell. Ayaw iLP.
Ga hodl sa ko ate hehe
You lost a lot of tokens, pero di pa rin po masama kasi safe ng BCH, which is yun po ang mahalaga. Sa mga experience ng iba, natututo na ako. Hehe.
Ako wala e. Haha. Pero ganun talaga. Part of improving yourself is to make a few mistakes.
Lessons learned.. And thanks for sharing your experience ate..
Kakulba sie ni. Haha. Ako nga nga sige ra gihapon ug explore kaback out-ton.
I can't relate to this ate but if ever I will have a chance to try this, I will avoid that LP hehe
i haven't tried mine yet....still doing some researching, reading others' experiences, like yours, to give me more ideas on what I'm getting into. Thank you for always sharing infos like these.
Still didn't know how this things work. But I'll try this next time when I have more to risk
Maybe it's a matter of luck, the market is unpredictable, still lesson learned and I'm glad that you've earned profit in BCH, I think that amount is enough to buy CATS and EBEN again.😅
Inabangan ko talaga tong article mo. I also provided liquidity but with other token, maliit lang ang value kaya d ako masyadong kinakabahan. If paired daw with stable coins medyo okay, i have bch/sbusd pairing.. Ung sa liquidity lang ung niremove mo po? What about dun sa farming? Hindi din ba sya safe?
Halla ate sa Pool yan hindi po sa Farm mismo? 😱 Sa farm po kasi naka stake Eben ko buti nalang maliit lang yung inano kong Cats sa LP CATS + BCH.
Yan nga. Liquidity Pool. Basta hirap igets ang term. Dm mo ako mamaya. Me papa check ako sayo.
Sige sige po ate.
This is such a timely article. Been doing more research about this since Ate Eybyoung commented on one of my articles. Thank you for this!
Huhuhu that's really too risky sis. But it was still fine since you also gain more bch. Lesson I gain here is that, once something is gone there will always another thing that will be added as well that makes it still valuable. 😊
I still don't have any about about LP tokens. It seems like that It has too risk so I think It is better to avoid it.
That's the risk really sis. Glad I pulled out mine earlier so I did't lose much. The impermanent lose is unavoidable.
Oh my. I really need to learn this all before risking anything I have. Pero bawing bawi naman po yung bch so di masyado masakit hehe pero masakit parin
Yeah, you've learnt your lessons. Maybe next time you be more careful meanwhile, congratulations on your earnings in BCH.
I never try this kasi ndi pa ako marunong hehe, tlagang need a thorough studies bago pasukin ang ganitong mundo hehe, pero atleast po safe pa din ung mga BCH earnings mo
Same in learning of Liquidity and stacking I also lost my CAT$ from 900000 to 1200. I am worried about this loss. But it is kinda part of life. Without risk you learn nothing.
Yeah this is the thing about LP. I think they can be great and I have been in a bnb-cake pool for a long time already and it does great, but with tokens that are super volatile it's playing russian roulette. Ah well, valuable lesson learned!
>Despite having more in BCH, I'm still saddened by the loss of my CATS and EBEN. You can buy EBEN and CATS for what you have gained in BCH when the price or the tokens falls. I got more EBEN than I put in, but less BCH. If I sell the EBEN, I will get less BCH in total than I put in. It is always the total that counts and not the individual token.
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