❓FAQ

What is the purpose of Lagoon?

The Lagoon protocol aims to provide a dynamic liquidity provision strategy based on real-time market data for Uniswap v3. It allows liquidity providers to automatically adjust their positions within specified ranges to optimize trading opportunities and maximize their earnings.

How does the protocol determine the optimal liquidity positions?

The protocol continuously monitors market indicators such as price movements, trading volumes, and volatility. It leverages this real-time market analysis to calculate the liquidity positions and price ranges that are likely to attract the most trading activity and generate maximum fees for liquidity providers.

What are the benefits of using this protocol as a liquidity provider?

By utilizing Lagoon, liquidity providers can benefit from an automated strategy that adjusts their positions based on real-time market data. This approach potentially maximizes your earnings, adapts to changing market conditions more effectively, and provides access to advanced liquidity provision strategies.

How are fees distributed to liquidity providers?

Liquidity providers earn fees from trades that occur within their liquidity range. The protocol distributes these fees among liquidity providers based on their proportional contribution to the total liquidity pool. Smart contracts handle the fee distribution process to ensure fairness and accuracy.

What are the risk management mechanisms in place to protect liquidity providers?

The protocol incorporates risk management mechanisms such as limiting exposure to extreme market conditions, automatic position rebalancing, and the ability for liquidity providers to set your own risk tolerance levels. These measures aim to mitigate potential risks associated with concentrated liquidity provision.

Is there a governance mechanism for the protocol?

Lagoon plans to introduce a governance mechanism where token holders can participate in voting and decision-making processes. This allows token holders to propose and vote on protocol upgrades, parameter adjustments, and fee structures, promoting decentralization and community involvement.

How can I participate in the protocol as a liquidity provider?

To participate, you can deposit your assets into the $LGN liquidity pool on Uniswap v3. From there, the protocol will automatically adjust your positions based on real-time market analysis, allowing you to benefit from the dynamic liquidity provision strategy.