V3
Last updated
Last updated
DragonSwap V3 introduces LP NFTs, allowing liquidity providers to control how they supply liquidity.
V3 allows liquidity providers to allocate liquidity within a specific price range, making capital use more efficient.
Example: Instead of distributing $10,000 across the entire price range, a provider can concentrate liquidity within $1.5-$2.0, increasing fee earnings within that range.
LP tokens in V3 are issued as NFTs, representing liquidity positions and accrued trading fees. These NFTs act as receipts and provide flexible liquidity management.
Liquidity earns fees only when market prices are within the provider’s specified range. When prices move outside the range, liquidity becomes inactive but remains secure.