Demo Lending pauses one pool
The team paused one pool after a suspected exploit. Other depositors are not known to be affected, and a post-mortem is promised.
What impermanent loss means
Providing liquidity can leave you with less value than simply holding the same tokens, even before accounting for fees.
How it happens
Automated market makers keep a pool of two tokens in balance. As prices move, trades shift the mix, leaving liquidity providers with less of the token that rose.
Why the name misleads
The loss is called impermanent because it can shrink if prices return. If you withdraw while prices are apart, it becomes real. Trading fees may offset it, but they aren’t guaranteed to.
Sources
[The Editor links primary sources here before publication.]
Disclosures
[AI use, holdings and commercial relationships are shown here.]