There are a couple ways to put your tokens to work on the 1inch Network. These methods consist of:

Liquidity Providing

As it sounds, liquidity providing is the act of sending a pair of tokens to a liquidity pool and locking them for any period of time. Rewards are distributed in the form of the underlying tokens (i.e. 1inch and WXT tokens). The APY for a liquidity pool varies based on the number of transactions going through the pool, in addition to the total amount of liquidity provided to it.

Please note: The displayed APY for all liquidity pools can be calculated with:

(current_liquidity/(current_liquidity - profit_last_24_hours))^365

Liquidity rewards can begin accruing immediately upon locking the tokens in the pool; however, know that impermanent loss could offset gains and may cause a negative rate of return.

As a provider, you’ll need an equal ratio (50/50) of each token to provide to the pool, in addition to any ETH or BNB needed for transaction gas fees. Liquidity pools operate indefinitely (as long as they have liquidity) and there are no time limits for deposit or withdrawal. Once the liquidity is provided, you will receive “LP Tokens” as a placeholder for your liquidity.

***Please note: If your "Provided liquidity" amount is less than the amount you initially provided, you may have experienced impermanent loss.

1inch Derivative Staking

Derivative staking is an alternative method to earning yield on your 1INCH tokens. By staking your tokens within a 1inch-ETH derivatives pool, you can earn passive income in exchange for providing insurance to Opium 1inch Turbo Option buyers. Historically, derivative staking pools have offered a reliable return on deposited funds, which are generated from the selling of Turbos.

***Please note: In an event where the pool does not sell a sufficient amount of Turbos within the specific time period, the staker's deposited assets remain in the pool with no penalty or risk of liquidation.

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