With massive rallies of DeFi and Farming on more Layer-1, Layer-2 projects as well as chances to get airdrops, people will take Opportunity Cost and easily to ignore risk of Impermanent Loss when they stake their altcoins in Liquidity Pools.
There are some Calculator tools to calculate Impermanent Loss and imagine some scenarios for it, think of your strategies, what to do with each scenarios before you start staking (farming) with AMM's Liquidity Pools.
If you don't understand what is Impermanent Loss, please read
- Understanding Impermanent Loss (https://medium.com/coinmonks/understanding-impermanent-loss-9ac6795e5baa)
- What is Impermanent Loss in crypto (https://whiteboardcrypto.com/what-is-impermanent-loss-in-crypto/)
- How to avoid Impermanent Loss (6 methods) (https://whiteboardcrypto.com/how-to-avoid-impermanent-loss/)
Some calculator tools.
- https://www.coingecko.com/en/impermanent-loss-calculator
- https://whiteboardcrypto.com/impermanent-loss-calculator/
- https://dailydefi.org/tools/impermanent-loss-calculator/
- https://coinstats.app/impermanent-loss-calculator/
- https://balancer.tools/impermanentLoss
Note:
- It was posted first in that topic, on Bitcointalk (https://bitcointalk.org/index.php?topic=5479379.0)
- I leave the source link to avoid plagiarism accusation.
- I excluded minor things from an original thread.