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How Liquidity Provision Works

Liquidity providers (LPs) deposit token pairs into pools and earn a share of every swap fee. Your liquidity makes swaps possible — and you get paid for it.

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The LP Flow

1

Select a Pool

Choose which token pair you want to provide liquidity for (for example CC (Amulet) / USDCx). You can see current reserves, fee earnings, and APR for each pool.
2

Enter Deposit Amounts

Specify how much of the first token you want to deposit. The required amount of the second token is calculated automatically based on the current pool ratio.
3

Create an LP Intent

Confirm your deposit. OneSwap returns the pool LP party plus a transfer reference for the intent.
4

Send Both Tokens

Transfer both token amounts from the same party to the LP address and include the same transfer reference on both Canton transfers. You currently have 24 hours to complete both deposits.
5

Receive LP Position

Once both deposits are detected, OneSwap credits your LP balance in the database based on your proportional share of the pool.

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How LP positions work

Your LP balance represents your ownership share of a liquidity pool.
  • Proportional — If you deposit 1% of the pool’s total value, you receive 1% of the LP supply
  • Appreciating — As swap fees accumulate, your LP balance is backed by more underlying reserves
  • Tracked by OneSwap — LP ownership is stored in the OneSwap database, not as a separate on-chain token in your wallet
  • Redeemable — Withdraw your LP balance anytime to receive your share of both underlying tokens plus accrued fees
Reserve displays, TVL, and current LP value use effective reserves. Pending platform, developer, and traffic-fee collections are excluded so LP balances are not inflated by treasury-owned funds still sitting on the swap party.

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Example

Your DepositPool TotalYour Share
CC (Amulet)10010,0001%
USDCx505,0001%
LP Balance10010,0001%
After 1,000 swaps generating fees, your 1% share now represents more CC (Amulet) and USDCx than you originally deposited.

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Deposit Requirements

  • Both tokens required — You must deposit both tokens in the pair
  • Ratio must match — Deposits must match the current pool ratio (the app calculates this for you)
  • 24-hour window — Both deposits must arrive before the current LP intent deadline
  • Transfer reference required — Include the returned reference on both Canton transfers so OneSwap can match them to the right LP intent
  • Incomplete deposits are refunded — If only one token arrives before timeout, it’s returned to you
  • Same sender required — Both deposits must come from the same Canton party that created the LP intent
  • One-sided pools are blocked — Existing pools with a zero reserve on one side reject new liquidity until they are reset

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Security and settlement model

OneSwap’s liquidity flow is designed to be non-custodial for token movement, but not fully self-custodial for LP ownership.
  • Direct-party deposits — Users send token A and token B directly to the pool LP party from their own Canton party.
  • Exact holding matching — The LP monitor consumes the exact deposit holdings that matched the LP intent. It does not sweep unrelated LP-party balances.
  • Refund-first failure handling — If the second token never arrives, the ratio changes too far, or the deposit does not match the intent, OneSwap refunds the deposit instead of partially crediting liquidity.
  • Database-tracked LP ownership — LP balances live in the OneSwap database rather than as a user-held on-ledger LP token.
  • Locked withdrawals — Withdrawals reserve the LP balance first, transfer both underlying tokens, and only then burn the LP balance.
LP balances are not self-custodied on-ledger LP tokens. The non-custodial guarantee here applies to the underlying token transfers, while LP ownership is maintained by OneSwap’s database and withdrawal logic.

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LP Intent Lifecycle

pending → partial (one token received) → processing (both received) → completed (LP position credited)
                                        → refunded (deposit returned)
                                        → failed (manual investigation needed)
                                        → cancelled
                                        → expired (second token didn't arrive in time)
        → expired (no deposits before the current 24-hour deadline)
StatusMeaning
pendingWaiting for both token deposits
partialOne token received, waiting for the second
processingBoth tokens received and the LP position is being credited
completedBoth tokens received and the LP position was credited
refundedDeposits were returned because the live pool no longer matched the intent
failedLP settlement failed and needs investigation
cancelledIntent was cancelled before completion
expiredTimeout reached — any deposited tokens are refunded

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Withdrawing Liquidity

You can withdraw your liquidity at any time:
  1. Go to View Positions to see your LP holdings
  2. Choose how much of your LP balance to withdraw (partial or full)
  3. Receive your proportional share of both underlying tokens
Your withdrawal includes all accumulated swap fees — there’s no separate “claim” step. When you withdraw, you get your original deposit plus any fees earned.
You can withdraw partially. If you hold 100 LP balance units, you can withdraw 50 and keep earning with the remaining 50.

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Withdrawal guarantees

  • The withdrawal destination can be your own party or another Canton party you choose.
  • OneSwap does not first send withdrawn tokens to a platform wallet and then forward them.
  • If one transfer leg fails during withdrawal, the withdrawal is left in a recoverable state instead of burning the entire LP claim and pretending it succeeded.

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Risks

  • Impermanent loss — If the price ratio between the two tokens changes significantly from when you deposited, you may receive less value than if you had simply held the tokens. Fee earnings can offset this.
  • Pool utilization — Earnings depend on swap volume. Low-volume pools generate fewer fees.

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Tips

  • Check APR before depositing — on supported pools it shows the annualized return from recent 7-day fee events and effective reserves
  • Monitor your positions — Use the View Positions tab to track your earnings in real time
  • Start small — Test with a small deposit to understand the flow before committing larger amounts