What causes constant drops in locked funds in the liquidity pool?

SilverCryptoBullet

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Quote from: Bitcoin_Arena on March 25, 2024, 05:28:50 PM

The difference is due to the constant change in the market price

It is from their APIs to estimate values with prices from exchanges. Fast or slow and source (exchange) where they retrieve the price for estimations.

Prices of Bitcoin on Coinmarketcap and Coingecko are different because they have different formulas and have different exchange pools to get an average price of Bitcoin.

Quote

The best way to look at it is to look at the amount of Pooled SOL and the token

I know. The numbers of SOL and token are same but values (estimated values) are different.

Bitcoin_Arena

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Quote from: SilverCryptoBullet on March 25, 2024, 05:48:33 AM

Liquidity pool value is estimation and can be estimated differently by different sites.
https://www.dextools.io/app/en/solana/pair-explorer/FubUaY9HZy5EhyBdq2oWPjAxBcVY5qtcCJRJimCXMk93?t=1711363467984
$109.26k

https://dexscreener.com/solana/fubuay9hzy5ehybdq2owpjaxbcvy5qtccjrjimcxmk93
$108k.

The difference is due to the constant change in the market price

The best way to look at it is to look at the amount of Pooled SOL and the token

Like in this case

dexscreener

dextools

SilverCryptoBullet

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Activity: 97

Merit: 43

Liquidity pool value is estimation and can be estimated differently by different sites.
https://www.dextools.io/app/en/solana/pair-explorer/FubUaY9HZy5EhyBdq2oWPjAxBcVY5qtcCJRJimCXMk93?t=1711363467984
$109.26k

https://dexscreener.com/solana/fubuay9hzy5ehybdq2owpjaxbcvy5qtccjrjimcxmk93
$108k.

Bitcoin_Arena

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฿itcoin for all, All for ฿itcoin.

I came back to this post because after some days of using dexscreener and trading the tokens there, I understood what happens

So the locked liquidity is valued in USD and not in SOL or the token amount. This means that every time the price of the token changes in Dollar, it is also likely to affect the value of the token in the liquidity pools. That's why the value keeps changing, sometimes after every minute.

I hope this also helps someone else looking for answers in the future.

Bitcoin_Arena

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฿itcoin for all, All for ฿itcoin.

My understanding of locked liquidity is that these are funds or tokens are can not be withdrawn from the liquidity pool if they are burned or until they are unlocked after sometime.

However, when I look at some liquidity pools of some token, The locked tokens in the liquidity pool keeps increasing and decreasing within seconds or a minute. I would expect it to just keep increasing since the tokens are locked and more are just getting locked or burned as time goes on.

What causes the constant small drops in values?

For example watch the liquidity of this Token - https://dexscreener.com/solana/fubuay9hzy5ehybdq2owpjaxbcvy5qtccjrjimcxmk93

Sometimes it increases, other times it drops, yet they claim that all the currently locked tokens are burned.

Topic: What causes constant drops in locked funds in the liquidity pool? (Read 83 times)