Below, we'll provide an example of how it operates and the potential for Enigma users to expand their income opportunities.
Let's say you decide to add liquidity to the PEPE-ETH pool on Enigma Swap. You contribute 10 PEPE tokens and an equivalent value of 1 ETH to the pool. In return, you receive liquidity tokens representing your share of the pool, let's call them L-PEPE-ETH tokens.
Now, whenever someone makes a trade between PEPE and ETH on the platform, they pay a small fee. Let's say there's a 0.3% fee for each trade. If someone swaps 100 PEPE for 0.01 ETH, they pay a fee of 0.00003 ETH.
These fees accumulate over time and are added to the liquidity pool. Since you're a liquidity provider, you're entitled to a portion of these fees based on your share of the pool. So if you own 10% of the total liquidity in the PEPE-ETH pool, you would receive 10% of the fees collected from trades.
Please note: The fee percentages provided in this example are subject to change.
