Impermanent loss is fine when it's just a little bit but it totally sucks if XRP goes 1000X. The absolute worst thing that could happen to an AMM investment is you wind up with a value exactly what you put in. Example you inject 1000XRP and $530, XRP goes up 10X so now you have 1xrp and $1054.70 because the AMM is trying to keep your investment in the pool at $1060. The AMM has sold most of all the XRP in the pool on the way up. But you got all those fees! If it's stable it's awesome, if it goes up in price you are better off loaning it out to make income. Personally I think AMM is fine once we have a high, stable price. Don't jump into an AMM without researching all that can happen to your tokens and your cash. (Not financial advice) Lewis is giving you more about the AMM than anyone else on youtube, but it really is not that simple.
Impermanent Loss is not a risk and definitely is not the biggest concern of AMM’s. I suggest people look into “Loss vs Rebalancing” LVR aka Arbitrage Extractable Value is where THE ACTUAL LOSS COMES FROM. The problem with Impermant loss is it doesn’t take into account anything that happens in between and is a poor benchmark. He’s wrong on so many things in this video XRPL is optimized for Volatility Harvesting Impermanent Loss is not a risk it’s an opportunity cost that is assumed you sold at the exact top which is unrealistic. It’s an potential opportunity cost. What everyone is forgetting about is that the LP token you receive from the XRP/RLUSD(ripple stablecoin) you would have a YIELD BEARING HYBRID STABLECOIN. 50:50 XRP/USD the flaw with AMM’s, it’s not where the price ends up at, it’s the amount of times the price diverges and then converges.
Please advise me if im wrong. Impermanent loss only happens when you unstaked your lp tokens. If say xrp goes up in value when we sell, the amount of xrp returned will be lesser. But it will be compensated by the additional amount of the second token. More say usdt is received. So, It balances out to the original amounts. So although you receive lesser xrp, you can straight away use the additional second token, ie usdt to buy more xrp, so both xrp and usdt amount can reset back to the original amounts you put in. Do advise me.
Show a list of AMM places to do ODL. Actually do it from your crypto wallet ledger to an actual market. The whole process. Buying in to getting your LP Token to getting paid out. Blur out your address of course. There is no video out there that slows down the entire process. Show us like we are 8 years old please.
Thank you so much, Lewis, for "being on a mission." AMMs are complex, but you presented the information in a manner that was simple and easy to understand. This is NOT easy to do. And, to do this, you, I'm sure, had to spend far more than 35 minutes to familiarize yourself with this topic. Thank you, again, for your time, expertise and altruism.
Watching the crypto market's ups and downs shows how quickly things can change. In crypto, strategic, informed trading isn't a choice; it's a must. Remember, caution is as crucial as ambition here. This dedication to continuous learning is inspiring...managed to grow a nest egg of around 1.2Biitcoin to a decent 11.4Biitcoin... I'm especially grateful to Kerrie Farrell, whose deep expertise and traditional trading acumen have been invaluable in this challenging, ever-evolving financial landscape....
On the grand scheme of things, once you understand the potential of trad!ng, you can bet on it but I think people need the education to fully understand...
Yes, Jackson.I've seen a couple XRP AMM videos, but I really want to know how to do it directly... Which platform or exchange and how to actually set it up.😅
I have held crypto, specifically XRP since 2017, met a young man in 2020 who had 250k XRP at the time. He told me he's going to sell out completely at 5 dollars. I asked him why you would sell everything getting only 1 million ish, after taxes you'd be nearly broke again. Why not buy diversify, and try to find coins that you can use to get monthly payments from as well as some coins that you can sell for cash and not touch your favorite coins for future investments
Hey Lewis, respect what you do! But your math is wrong please redo it with the dollar value (which it should be, example $100 worth of xrp - $100 worth of usd) not per coin. You will see that at the end you won’t have more cash than holding it as is. In amm you will only benefit from the fees not the value of the coins.
Thanks, Lewis, for all of the work you put into these informative videos. Would you be willing to show us a short video that shows which wallet/wallets are best for XRP AMMs, and step-by-step how to actually use them please? I sincerely appreciate your videos, and I think that would help a lot of us out.
I like your videos, but just you explaining AMMs confused me even more. The only thing I understood was the only people making money are the people who add 10,000+ xrp or $500,000 dollars. Fairdesk or copytrade is also another confusing 1.
Yes...I find AMM very confusing since it seems to me you are selling your crypto thru the AMM....and gambling XRP value will not jump quickly to see a profit and keep your xrp
Correct…unless you also provide the other pool pair (in this case dollars, or a dollar backed stable coin). In other words, if you provide $1000 worth of XRP + $1000 of Tether = no XRP will be sold = no tax event. If you only provide $1000 of XRP, $500 will remain XRP and the other half of your XRP will be traded for USD. This sale of $500 of XRP would be a taxable event.
Ripple controls the liquidity pool algorithm. It is a rigged game. Sell XRP and invest in a quality PoS coin. Forget all this wrapped token, liquidity pool, impermanent loss, Bull schmidt !
In case anyone wonders: The word "Arbitrage" has its roots in latin and french. A late Middle English word (originally denoting the exercise of individual judgement). The current sense dates from the late 19th century.
NOT SELL, BUT MAKE YOUR TOKENS WORK FOR YOU! LEARN DEFI, DEX, AMMS! GET OUT THIS HODL MINDSET, YOU CAN BE MAKING MONEY RIGHT NOW. CHECK OUT THE MAGNETIC DEX! EDUCATE YOURSELF! YOUR WELCOME!
NOT SELL BUT MAKE YOUR TOKENS WORK FOR YOU! YOU COULD BE MAKING MONEY RIGHT NOW INSTEAD OF HAVING YOUR TOKENS LOCKED AWAY. THEY ARE DESIGNED TO BE USED AS LIQUIDITY! WAKE UP, GET OUT THIS HODL MINDSET. EDUCATE YOURSELF ON DEX, AMMS AND DEFI! CHECK OUT MAGNETIC DEX. YOUR WELCOME!
@@jamil1985 HODL your XRP! HODL mindset is the mindset who made people rich and not this bullsh*t. Only use AMM and sh*t if you have at least large ammounts of crypto and you know how to use it.
Hey Lewis, always have loved your research. A word of advice, take care of yourself, if you need time away or what ever , do it! Your health and mindset is the most important thing! Don’t know what is going on in your personal life but your health is the MOST important thing! We all will be here if you need time!! God bless my friend
I will be forever grateful to you, you changed my whole life and I will continue to preach on your behalf for the whole world to hear you saved me from huge financial debt with just a small investment, thank you Elizabeth Wesley.
She is my family's personal Broker and also a personal Broker to many families in the United states, she is a licensed broker and a FINRA AGENT in the United States.
They be thinking there average veiwer is as smart as them😂😂😂 Nope. We're Not😂. Just show us how to do it step by step and how to pay taxes and we can figure out the basics later😂😂😂
Lps are like the first proper use NFTs, where u can sell a portion of liquidity in a pool you own, broken down into further smaller Lps in profit. It's basically digital receipts of digital contracts.
Hi Lewis. Is there a situation where you can have both of your assets increase rather than having one asset decrease to balance out the pool? You also said arbitragers can sell their token in the AMM? How do they do that? Is that just contributing to the pool (when it's at a lower price) and withdrawing when it reaches a higher price? Ty for your videos 😊
It will be a liquidity pool. You invest $100 of XRP and $100 of RLUSD. But be careful, because you will be paid in LP token. What the value of a LP token will be is any bodies guess.
Thank you so much for this! I know you probably won’t see this but this was so helpful. I spoke with Caleb & Brown for an hour yesterday and they didn’t explain it nearly as well.
Exactly and why xrp is fity cent. Too many damn tokens and except for Schwartz last week finally admitting the rest of officers in ripple and xrp say nothing..supply way too high demand way too low . Spot on!
I have been feeling confused about AMM previously, now I'm really confused, I can't see the benefit, it does sound like something promising but there's no obvious benefit. I have a feeling you're teaching skills is not your forte.
Soooo, you don’t get the yield generated from fees until you withdrawal your liquidity? Is there any way to get the fees and still keep your liquidity in the pools?
Not your keys not your assets..xpr is valuable on usuability, accetability and improvement basis in "our market". I keep my xrp. This person doesn't know he talks about...Sell Holiday homes somewhere!
Dude your definition of Impermanent Loss is incorrect. Impermanent Loss is one of the most misunderstood concepts in the space. It is NOT as many people mistakenly understand it "You put money in, and when you come to claim that money back out, it is less than you put in". It IS : "The value of your assets in the liquidity pool is less than they WOULD have been if you had simply HODL'd the assets" It is entirely possible to make a profit in an AMM *AND* still suffer impermanent loss, i.e. have less value than if you had simply HODL'd the assets. This is explained in heaps of places online, please look it up and understand it fully before putting out more content on impermanent loss.
Your maths in the example is also off. In the example you won't be able to add 100XRP @ $0.53. AND $100 USD because the sides are not of equal value. Your XRP side is valued at $53 USD (100 XRP @ $0.53) so your USD side would need to be $53 NOT $100. This means your total value added would be $106 USD. The product of that value (XRP AMM's use a constant product algorithm) would be 100*53 => 5300 Liquidity Units if XRP doubled in price to $1.06 per XRP, the arbitragers would go to work to balance to pool. Your part of the pool would now be made up of (approximately) 70.71 XRP * $74.95 USD => 5300 (approx) liquid units. Noting that 70.71 XRP @ 1.06 => $74.95 USD worth of XRP to balance the $74.95 on the USD side. The total value of your assets in the AMM would be : $149.9 . You would have made money in the AMM given your initial value added was $106 USD If you had just HODL'd the XRP you'd have $159 USD total value (100 XRP * $1.06 => $106 + $53 USD), so whilst you have made money in the AMM, you have also suffered an impermanent loss of $9.10 USD It is true that you recover your impermanent loss (of $9.10) if you leave your assets in the AMM until XRP goes from $1.06 back to $0.53, but this also means your overall value in the AMM is also going from $149.90 back to $106. It also only counts if XRP actually does go back to the $0.53 level and utility pricing doesn't kick in exacerbating the impermanent loss.
Don't let Amazon's AMS25K pass you by. This is a monumental moment in history, and you don't want to be left out of the loop. Get in on the ground floor now!
Just swapped all of my last ETH and swapped it into AMS25K. Already up a little bit. Unfortunately I have some other junk staked which won’t free up for a while. Still now I am on the train!
And when these novices start losing their asses in AMM's. Are you going to reimburse their losses? There is massive volatility involved in AMM's. I thought you were not supposed to be giving financial advice?!
Why not just buy a modern token that can perform on-chain smart contracts…and offers staking? Why mess around with this convoluted, low tech, impermanent loss BS ?
