Liquidity - Provide

How to Open a Liquidity Position

This guide will walk you through the process of creating a liquidity position in cover pools. By providing liquidity, you can earn both cover and strategy rewards, potentially increasing your overall yield in the DeFi ecosystem.

Steps to Open a Liquidity Position

1. Access the Market Page

First, ensure you're connected to the DApp and can view available cover pools.

1. Connect your wallet to the DApp.

2. Confirm you're on the appropriate network (e.g., Ethereum mainnet, Polygon, etc.).

3. Navigate to the Market page to view the available cover pools.

Accessing market page

2. Select Your First Pool

Choose a cover pool to begin creating your liquidity position.

1. Review the available cover pools, considering factors like APR, risk level, and underlying assets.

2. Click the "Add to Position" button on your chosen pool to start the position creation process.

Selecting first pool

3. Build Your Position

After selecting your first pool, you can add multiple pools to optimize your position.

1. Review the details of your current selection in the overlay.

2. Consider adding multiple pools to increase your APR. Remember:

   • Each additional pool increases your leverage and the corresponding risk fee applied to your cover rewards.

   • All pools in your position must use the same strategy.

   • Some pools may be incompatible if they have the same underlying protocol risks.

3. Click the "Details" button to view your APR composition and remove pools if needed.

4. Once satisfied with your pool selection, click the "Open Position" button.

Building position

4. Choose Deposit Token and Amount

Specify the token and amount you want to add to your position.

1. If the pool allows it, choose between depositing the underlying asset or the strategy LP token.

   • Underlying tokens are automatically converted to strategy LP tokens during deposit.

2. Enter the amount of tokens you want to add to your position.

3. Review the estimated rewards and risks associated with your deposit.

Choosing deposit details

5. Approve the Smart Contract (if necessary)

You may need to approve the Athena smart contract to interact with your funds.

1. If an "Approve Token" button appears, click it to proceed.

2. If no approval is needed, skip to the next step.

Approving the smart contract

6. Wait for Approval Transaction

If you needed to approve the smart contract, wait for the approval transaction to be validated on the blockchain.

1. Keep your wallet open and connected.

2. Wait for the transaction to be confirmed (this may take a few minutes depending on network congestion).

Waiting for approval transaction

7. Confirm Liquidity Addition

Once approved (or if approval wasn't necessary), you can finalize adding liquidity to your position.

1. Review all details of your position one last time.

2. Click the "Confirm" button to add the liquidity to your position.

Confirming liquidity addition

8. Wait for Transaction Validation

The liquidity addition transaction will now be processed on the blockchain.

1. Keep your wallet open and connected.

2. Wait for the transaction to be confirmed (this may take a few minutes depending on network congestion).

Waiting for transaction validation

9. Verify Your New Position

Once the transaction is validated, your new liquidity position will be active.

1. Navigate to your Dashboard.

2. Locate your newly created position in the list of active positions.

3. Review the details to ensure everything is correct, including:

   • Pools included in your position

   • Amount of liquidity provided

   • Estimated rewards and APR

Verifying new position

Important Considerations

• Providing liquidity comes with risks, including potential losses in cover pools you provide liquidity to.

• Your actual returns may vary from estimated APRs due to market conditions and pool performance.

• Monitor your position regularly and adjust as needed based on your investment strategy and risk tolerance.

• Be aware of the commit period before withdrawal can be made.

By following these steps, you've successfully opened a liquidity position in one or more cover pools. Remember to stay informed about the performance of your chosen pools and the overall DeFi market conditions to make informed decisions about your investments.