> For the complete documentation index, see [llms.txt](https://osige.gitbook.io/osige-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://osige.gitbook.io/osige-docs/liquidity/provide-liquidity.md).

# Provide Liquidity

Liquidity providers (LPs) deposit tokens into pools so traders can swap. Active liquidity earns LP fees on each swap.

<figure><img src="/files/LhjfThIFBxIyCcnZy2Ii" alt=""><figcaption><p>Osige liquidity page with a pool list, TVL, and volume</p></figcaption></figure>

## Understanding concentrated liquidity

Unlike a traditional AMM (CPAMM), where deposits are spread across all price levels, Osige lets you select the **price range** your capital will cover.

* **In range:** When the pool price is within your range, your liquidity participates in swaps and earns fees.
* **Out of range:** When the price leaves your range, the position stops earning fees and its composition shifts mostly into one of the two tokens. It automatically becomes active again if the price returns.

The trade-off is straightforward.

**A narrow range** concentrates capital near the current price and earns a larger share of fees while the price stays in range, but it goes out of range sooner and requires more management.\
**A wide range** withstands larger price moves, but fees accumulate more slowly.

Automatic rebalancing is not provided, so you must manage your range yourself.\
This is why [Copy Trading](/osige-docs/osige-features/copy-trading.md), which lets you view and follow the ranges public LPs actually use, can be useful.

## Open a position

1. Choose a pool in [Pools](https://osige.exchange/liquidity). Check the tokens, fee tier, and hook policy. Some pools require a Dojang Verified Address or an active `up.id` to provide liquidity. See [Identity Features](/osige-docs/osige-features/identity.md).
2. Select **Deposit**. Choose a range preset or set the boundaries directly on the price-range chart.
3. Enter amounts. The required token ratio depends on the current price and your selected range. A range entirely above or below the current price deposits only one token.
4. If requested, approve the tokens. Osige supports Permit2-based approvals, and the wallet flow identifies whether you are signing a permit or a standard approval transaction.
5. Review the summary, including the range, amounts, and whether it starts in range, then confirm the transaction.

The position is issued as an NFT. Osige calls it an **OLP**. The OLP is held in your wallet and appears in the Portfolio tab of your profile. The NFT owner controls the liquidity and fees, so keep it secure.

## Manage Position

On the position-management page, you can:

* **Monitor:** Check current value, token composition, range status, and pending fees. Indexed data and live reads can differ briefly because they refresh at different times.
* **Add liquidity:** Add more capital to the same range.
* **Reduce liquidity:** Withdraw part of the tokens without closing the position.
* **Collect fees:** Receive accumulated fees. Fees are not automatically reinvested, and collecting them requires a separate transaction and gas.
* **Close:** Remove all liquidity, collect remaining fees, and burn the NFT.

Before treating a position as fully closed, confirm that the tokens arrived in your wallet and that the transaction is confirmed in the [Explorer](https://sepolia-explorer.giwa.io).

## Risks to understand

* **Impermanent loss:** When the two tokens diverge in price, an LP position can perform worse than simply holding them, even after fees. This is inherent to AMMs.
* **Leaving a position out of range:** An unmanaged position can remain without earning any fees.
* **Shallow markets:** Testnet pools may have shallow liquidity, causing prices to move sharply.
* **Hook policies:** A pool hook can limit eligibility to provide liquidity. Current Osige identity hooks only check entry, so an expired identity does not block your exit.

See [Risks and Security](/osige-docs/reference/risks-and-security.md) for the full details.

{% hint style="info" %}
Everything in Osige currently runs on GIWA Sepolia.\
Displayed TVL, volume, and APR are testnet figures with no monetary meaning.
{% endhint %}


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