several years ago, my fascination for liquidity provision started with the release of the uniswap protocol.

fast forward to today, we are almost on v4, but i will take a look a v1 in order to understand why and how the protocol evolved.

with v1, uniswap introduced a way for people to provide liquity in form of pools for different trading pairs in order to enable other people to trade that pair and get the fees the trader payed added to the position.

this was convenient as you could just watch your position grow. at this time, with eth around 300 dollars, tracking that position was not as convenient as it is today and awareness about impermanent loss was just starting to rise.

as the prices started to rise, it became apparent, that if you provide liquidity in equal amounts, your postion already sold a lot for cheap.

my aim was always to stack more, but suddenly i ended up having way less... 

i somehow was not fully aware, being in the eth-dai pair at the time, that i was selling half of my eth in order to participate. 

today everything seems clear and easy, but believe me at this time it was not.

i exited the position during the earlier stages of the big run up in 2020 with quite a loss, but for good.

the impermanent loss problem got somewhat fixed in v3, but more on that later.

i held the stables and moved them to polygon.

at the beginning of the year, i started an experiment with them, and i am quite satisfied with the outcome so far. i plan on keeping you updated on that one in the future.