# Why Provide Liquidity?

## 1. Earn F**ees 💸** 

When setting up a **market-making order** on TensorSwap you can **configure your own custom fees** in the **range of 0-25%.**

That's 0-25% of the trade that goes into **your pocket**.

Obviously, orders with lower fees will be more competitive, so there's a golden middle to be struck. We think fees up to 5% are reasonable.

{% hint style="success" %}
What about royalties?

Tensor has a maker/taker fee model, so when providing liquidity, you neither have to pay royalties nor platform fees!

If you're interested in why we went with this approach, read [Fees & Royalties](/trade/fees-and-royalties.md)

{% endhint %}

{% hint style="info" %}
How much you can make market-making? What happens if the price of the NFT falls/rises sharply? What are the risks? 🤔

Check out our detailed [Market-Making Example](/provide-liquidity/market-making-example.md) for answers.
{% endhint %}

## 2. Earn Rewards ⭐️

Active traders on TensorSwap were rewarded with points from Season 1 to 4 which were converted into reward boxes.

{% hint style="success" %}
We're rewarding **Market Makers** with Tensor Points rewards! 🔥

As of today, creating "**maker**" orders (collection-wide bids, listing orders, market-making orders) earns tensor points for listing in the top 100 by 24-hour volume.

Hint: The closer your bid/listing is to the floor, the more points you will earn.
{% endhint %}

{% hint style="info" %}
A ton more detail is available in [Rewards](/welcome/rewards.md).
{% endhint %}

## 3. Auto-manage your NFT Portfolio 💰

We all know what to do: **buy low -- sell high**. But damn is it hard to follow. Emotions get in the way when markets rally we don't want to sell when we should -- then they fall and we should be buying but we're first to sell.

The good news is that automated strategies on TensorSwap **force you** to buy low and sell high:

* Collection-wide bids **lower the price** with each consecutive purchase you make
* Listing orders **up the price** with each consecutive sale you make
* Market-making orders are the best of both worlds: they **both** lower the price for purchases and up the price for sales, AND they make **fees** in the process 💸

This means your NFT portfolio will grow and shrink **precisely at the right times**. 

* When everyone is **fearful** and selling 😱 - you're **accumulating** ✅
* When everyone's **greedy** 🤑 - you're **selling** ✅

{% hint style="info" %}
You might have heard of [dollar-cost averaging](https://www.investopedia.com/terms/d/dollarcostaveraging.asp) or "DCA" in the past. TensorSwap is EXACTLY that. You tell us how many NFTs you want to buy/sell, and our algorithms handle the rest, making sure you **buy low & sell high.**
{% endhint %}

## BONUS: What about Staking? 🤔

One obvious question that comes up is: **but what about staking?** To provide liquidity on TensorSwap, you must remove your NFTs from any staking vaults. But that means you lose tokens/yield from those vaults! 😱

What do?

One way to think about it is as follows: well, **what are the tokens that this NFT project is giving you actually worth?**

By providing liquidity on TensorSwap you're earning:

* **✅ Hard cold SOL** for market-making

The first point is really the strongest. **It's very hard to argue that hard cold SOL is worse than some imaginary internet money** someone else promises you (including us!). Remember: market-making pays you **hard cold SOL** ☀️, right into your wallet. 

## Ready to Provide Liquidity? 🚀

If the above convinced you to give TensorSwap a go, check out [How to Provide Liquidity](/provide-liquidity/how-to-provide-liquidity.md)


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