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0. What is Osmosis DEX?

Osmosis DEX is a Tendermint-based decentralized exchange that allows you to swap various Tendermint-based tokens with MED, including ATOM. In addition, users can receive incentives by providing liquidity.

1. What is a Decentralized Exchange?

The decentralized exchange is called the DEX (decentralized exchange), and unlike the centralized exchange, it is an exchange implemented in a P2P manner. Osmosis uses an automated market maker (AMM) exchange that allows for the immediate swapping of coins at low fees.

2. What is Liquidity?

To swap coins smoothly in DEX, liquidity must be in place. In particular, liquidity is most important in AMM-based exchanges, as maximizing liquidity supply can reduce the price volatility when swapping. Therefore, many decentralized exchanges offer incentives for liquidity pool supply. We currently have two pools in Osmosis DEX: MED-OSMO and MED-ATOM, which are capable of providing liquidity and receiving rewards (OSMO).

3. Precautions

A common concern when supplying liquidity to DEX through LP is “impermanent loss.” Impermanent loss refers to the difference between two coins being tied with LP and being held as single coins in the event of fluctuations, such as an increase or decrease in coin prices. In other words, the greater the price fluctuations between two pairs of LP-bound coins, the higher the impermanent loss. For a detailed description of impermanent losses, please refer to the document below.

What is Impermanent Loss?

4. Supplying Liquidity

Several methods are available to provide liquidity to Osmos DEX. Select your desired method, and refer to the guide.

Bonding LP and Earning with Keplr(PC)

Bonding LP and Earning through Cosmostation(Mobile)

5. Yield Farming through Rewards

If you supply liquidity to Osmosis DEX, you can earn OSMO as a reward. There are two ways to gain OSMO, so you can begin yield farming the way you want.

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