⚠️Risk Factors

Each coin in the DeFi system has the same value, the same attributes, and the same emotional response. However, in the case of NFTs, each NFT is different and when you create an LP with your NFTs, you must deposit your NFTs into that pool. If you withdraw NFTs from the pool, they may or may not be the same ones that you deposited. It is obvious that you should not add your favorite/rare NFTs to your LP as you will/might lose them. Additionally, if you create a liquidity pool for a collection and the floor of that collection has pumped, you are likely to trigger all of your sell orders and not be able to complete many of your buy orders and there will be an impermanent loss in such a situation until the accumulated fees exceed the price pump of your NFTs. However, you may be able to obtain a higher yield by holding those NFTs. It is not completely risk free and can result in impermanent losses, however, the greater the risk, the greater the reward.