🌊How to Provide Liquidity
Earn trading fees & LP rewards by providing liquidity and creating markets for your favorite NFT collections on TensorSwap.
Last updated
Earn trading fees & LP rewards by providing liquidity and creating markets for your favorite NFT collections on TensorSwap.
Last updated
Wondering why should you bother? Read Why Provide Liquidity? first.
"Providing liquidity" on TensorSwap means creating "maker" orders, which include:
If you're unfamiliar with "maker" / "taker" terminology, read this.
Early liquidity providers on TensorSwap are eligible for accelerated rewards. ⭐️
Read more in Rewards
Collection-wide bids let you put in an offer for the entire collection. For example, you might offer to buy "any SMB" for 100 SOL. Anyone with a SMB can then take that offer.
When placing more than one bid at a time you can make use of TensorSwap's bonding curve functionality. This is just a fancy way of saying you can automate your bid prices to adjust downwards with every subsequent purchase.
If you choose an "exponential" bonding curve (%) with a starting price of 1 SOL and an increment of 10%, each consecutive purchase will be 10% lower. So for 5 NFTs, it would be: 1 SOL > 0.9 > 0.81 > 0.74 > 0.67.
To set up a collection-wide bid:
Head over to https://www.tensor.trade/
Choose your desired collection
On the right hand side choose BUY > then COLLECTION-WIDE BID
Choose the number of NFTs you are willing to buy, starting price, and the decrement, then place the order
For a detailed tutorial on placing collection-wide bids, see Buy or Bid.
List orders let you list a bunch of NFTs at the same time, exactly like listings you'd put up on OpenSea or MagicEden, with one big difference - you can configure a bonding curve.
Bonding curve simply means that with each sale, your selling price adjusts upwards. This lets you sell at higher prices as your portfolio gets depleted.
If you choose a "linear" bonding curve (◎) with a starting price of 1 SOL and increment of 0.1 SOL, each consecutive sale will be 0.1 higher. So for 5 NFTs, it would be: 1 SOL > 1.1 > 1.2 > 1.3 > 1.4.
To set up a list order:
Head over to https://www.tensor.trade/
Choose your desired collection
On the right hand side choose SELL > then LIST
Choose the number of NFTs you re willing to sell, starting price, and increment, then place the order
For a detailed tutorial on listing NFTs, see Sell or List.
You'll need to be in "Pro" mode (bottom toggle) to market-make.
Market-making orders are the most complex but also the most interesting out of the three.
In short, it's a two-sided order in which you're offering to both buy and sell a certain number of NFTs.
Read the above two sections first to understand how collection-wide bids and list orders work.
An MM order is just a collection-wide bid + a list order placed together, with a few key differences:
When placing a MM order, your starting BUY price will be 1 notch lower than your starting SELL price. So, for example, if you're setting up a MM order on a linear curve with 0.1 SOL delta and 1 SOL starting price, your first BUY price will be 0.9 (0.1 lower than 1 SOL).
Placing an MM order lets you set up custom fees (up to 25%). These are charged on top of Tensor's 1% taker fees and are completely up to you. We recommend setting up something reasonable, so you attract buyers.
When a MM order SELLs to the taker (buyer), royalties are voided. This is done to incentivize market-making orders which create volume and liquidity for the collection. When a MM order BUYs from the taker (seller), royalties are upheld and paid by the taker.
To set up a market-making order:
Head over to https://www.tensor.trade/
Choose your desired collection
On the right-hand side choose MARKET-MAKE
Choose the number of NFTs you re willing to buy & sell, starting price, and delta, then place the order
For a detailed tutorial on market-making NFTs, see Market-Make.
For a rundown of config params & for 3 simple templates (low risk 🟩, medium risk 🟨, high risk 🟥) check out Setting up your Market-Making Order
