Glossary

Please familiarize yourself with the key terms used throughout the liquidity provision process.

Basic Terms

Liquidity

The total amount of tokens deposited in a Pool to facilitate smooth trading. The more liquidity available, the larger trades can be processed without significant price impact.

Liquidity Provider (LP)

A user who deposits tokens into a Pool to provide liquidity. LPs receive a portion of trading fees as rewards.

Pool

A smart contract that holds two types of deposited tokens. Users exchange tokens through this Pool.

Token Pair

The two types of tokens that make up a Pool. Example: CROSS/CROSSD

TVL (Total Value Locked)

The total dollar value of assets deposited in a Pool. A higher TVL indicates more abundant liquidity.

Fee-Related Terms

Fee Tier

The fee rate charged per trade. You can choose from 0.01%, 0.05%, 0.3%, or 1%, selecting the appropriate tier based on the token's volatility.

Trading Fee

The fee paid by users when swapping tokens. This fee is distributed to LPs who have provided liquidity within the relevant price range.

APR (Annual Percentage Rate)

The estimated annual rate of return. Calculated as (Total Fees / TVL) × 365. Actual returns may vary depending on trading volume and price fluctuations.

Price Range Terms

Concentrated Liquidity

A method of concentrating liquidity within a specific price range only. This provides higher capital efficiency compared to distributing liquidity across the entire price range.

Price Range

The minimum price (Min Price) and maximum price (Max Price) interval within which you provide liquidity. You only earn fees when the current price is within this range.

Tick

The smallest unit used to represent a price. Prices entered by users are automatically converted to valid Tick values. Tick spacing varies depending on the Fee Tier.

Full Range

A method of providing liquidity across all price levels from 0 to infinity. While capital efficiency is low, it ensures the position never goes Out of Range.

Capital Efficiency

A measure of how much liquidity can be provided with the same amount of capital. The narrower the price range, the higher the capital efficiency.

Position Status Terms

Position

A unit of liquidity that a user has provided to a specific Pool. Each position has a unique price range and liquidity amount.

In Range

A state where the current token price is within the set price range. Trading fees can only be earned in this state.

Out of Range

A state where the current token price has moved outside the set price range. Fee accrual stops, and the position consists of only one type of token.

Risk-Related Terms

Impermanent Loss

The difference in value between depositing tokens in a Pool versus simply holding (HODLing) them. The greater the price movement, the larger the loss. It is called "impermanent" because the loss decreases if the price returns to its original level.

Slippage

The difference between the expected trade price and the actual execution price. Slippage can also occur during liquidity provision if the price changes while the transaction is being processed.

Transaction-Related Terms

Approve

A transaction that grants a smart contract permission to use the tokens in your wallet. Required once per token for the first use.

Network Fee

The fee paid to process a transaction on the blockchain. Paid in CROSS.

NFT (Non-Fungible Token)

A unique, non-interchangeable token. In the CROSSD Pool, each position is issued as an ERC-721 NFT to manage ownership and information.

Claim / Collect

The action of withdrawing accumulated trading fees to your wallet.

Burn

The permanent deletion of an NFT. When 100% of liquidity is removed, the corresponding position NFT is burned.