This guide explains how liquidity pools can put idle tokens to work on decentralized exchanges. You’ll learn how DeFi liquidity works, what risks actually matter, and how to add liquidity to a TON pool in under fifteen minutes.
Quick highlights
- Liquidity pools are smart contracts that hold two tokens and let anyone swap instantly without waiting for a buyer or seller.
- You get a share of swap fees by depositing equal-value tokens into a pool and receiving an LP token as your receipt.
- Impermanent loss happens when pooled token prices diverge; stablecoin pairs usually reduce this risk, while volatile pairs amplify it.
- Check your pool’s rates weekly and watch for incentive program end dates — bonus rewards can change fast.
What liquidity pools actually do
ℹ️ A liquidity pool is a smart contract holding two tokens — say TON and USDT — so people can swap one for the other at any time, without waiting for someone else to post a matching order. Traditional exchanges use order books: you submit a buy or sell and wait until another trader takes the other side. Pools skip that queue.
Instead of matching orders, the pool uses an algorithm to set the swap price based on how many tokens sit on each side. Add more TON and the TON-per-USDT price moves; pull TON out and it moves the other way. Swaps run 24/7, with no central desk approving anything.
Anyone can deposit tokens into the pool and share in the swap fees it generates. For example, imagine a pool holding 10 TON and 100 USDT. If you swap 1 TON in, the pool adjusts the ratio and returns roughly 9.9 USDT — slightly less than the headline price because your swap moved the balance. That gap is slippage, and bigger swaps usually increase it.
Because pools never “close” and anyone can add liquidity, decentralized exchanges built on them can offer continuous swaps without an order book. The same mechanics also explain why large swaps tend to get worse execution than small ones.
How AMM pools price your swaps
The math sounds scarier than it behaves. In many AMM pools, a simple formula keeps the pool balanced: when you add one token, the pool releases the other while maintaining an internal relationship between the two balances. The key result is intuitive: the more you push into one side, the less you get per unit out of the other side.
A small swap barely changes the pool ratio, so your execution stays close to the current price. A large swap drains one side more aggressively, so each extra unit costs more than the last. That’s why splitting a large swap into smaller chunks can sometimes reduce slippage.
ℹ️ Slippage is the gap between the rate you see when you tap Swap and the final rate you get when the transaction settles. Your slippage tolerance defines how much movement you’re willing to accept before the transaction cancels. If price movement exceeds your limit, the swap reverts and you keep your tokens (minus network fees).
Now flip the perspective: instead of paying the fees, you can become the one receiving them.
Becoming a liquidity provider
To add liquidity, you usually deposit two tokens in equal dollar value. If TON trades at five dollars, pairing 10 TON with 50 USDT gives a balanced deposit. Pools require balance because the pricing rule assumes the ratio stays consistent when new liquidity comes in.
Keep extra TON in your wallet for network fees — approvals and deposits are transactions, and transactions need fees.
Five-minute checklist
- Open STON.fi and connect your wallet using the browser extension or mobile app.
- Tap Pools, then select the pair. You may start with TON/USDt or another lower-volatility stablecoin pair from the list.
- Enter the amount of one asset, e.g. TON in the deposit box; the amount of the other token will be calculated automatically.
- Confirm operation; wait a few seconds and check your wallet for the new LP token.
ℹ️ Your LP token represents a percentage of the entire pool. If you deposited 10 TON into a 2,000-TON pool, you own 0.5% of the liquidity. Every swap through the pool generates a fee (the exact fee depends on the pool), and your share of liquidity determines your share of those fees. When you withdraw, you burn the LP token and the pool returns both underlying tokens in proportion to your share, plus the fees accrued since deposit.
| Read more in our guide: How to provide liquidity on STON.fi |
Monitoring your liquidity and withdrawing
Set a simple routine: check your pool once a week. Incentive rates can change, volume shifts over time, and new pools may appear with better conditions. A quick review helps you avoid leaving funds in a pool that no longer fits your plan.
Withdrawing is the reverse of depositing: tap Withdraw, enter the percentage you want to pull, and confirm. The pool burns your LP token and returns both underlying tokens plus accrued fees. You’ll receive different token amounts than you deposited if prices moved — that’s impermanent loss (or the reverse) showing up at the exit.
ℹ️ Impermanent loss happens when the prices of your two pooled tokens diverge after you deposit. Here’s a simplified example. You deposit 1 TON and 5 USDT when TON is five dollars, so the deposit is worth ten dollars. If TON later doubles, the pool shifts your token mix to keep its balance, so you withdraw fewer TON and more USDT than you started with. That mix can be worth less than simply holding the original tokens.
The effect tends to be larger with volatile pairs (for example, TON paired with a token that swings hard). It’s usually smaller with stablecoin pairs, because the two prices don’t drift as much.
| Read more in our guide: How to withdraw funds from a liquidity pool |
How Omniston expands your TON liquidity reach
Omniston aggregates liquidity across multiple TON DEXs and RFQ resolvers, routing swaps to the source offering the best rate. When you provide liquidity on STON.fi, apps integrated with Omniston can discover your pool automatically.
That can increase the odds your liquidity gets used without you manually tracking every venue. Instead of moving liquidity around because one pool is “hot,” routing can direct swaps toward where liquidity already sits. More swap volume can mean more fees, with no extra steps after your initial deposit.
Wrapping up
Liquidity pools let idle tokens support swaps and generate fees as the pool gets used. For most beginners, stablecoin pairs are a simpler starting point: you can learn the deposit and withdrawal flow without the sharpest impermanent loss swings. Check your pool’s stats weekly and keep an eye on incentive program end dates.
