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Strategy · Yield

CONCENTRATED LIQUIDITY PROVISION

NeutralUndefined riskAdvanced

Overview

Provide liquidity in a tight price range on Uniswap v3 or similar. Earn outsized fees compared to passive LPs in exchange for active range management.

Setup

  1. 1.Pick a deep-liquidity pair (ETH/USDC, ETH/wBTC).
  2. 2.Set a range covering ~30% above and below current price.
  3. 3.Deposit equal-value amounts of each token within the range.
  4. 4.Monitor the position — if price exits the range, you stop earning fees.
  5. 5.Rebalance weekly; redeploy liquidity into the new active range.
  6. 6.Track impermanent loss versus fees collected.

Max profit

Fee yield can exceed 30-100% APR in volatile pairs.

Max loss

Impermanent loss can offset fee earnings; full loss possible on smart-contract exploit.

Breakeven

Fees collected > impermanent loss + gas.

When to use

In ranging markets with high volume. When you can monitor positions actively.

When to avoid

In trending markets where price exits your range quickly. With low gas budgets.

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