Work out impermanent loss instantly with clear inputs, formula shown and shareable results.
In a constant-product pool, price divergence forces the pool to sell the appreciating token and buy the falling one. The resulting shortfall against simply holding is impermanent loss: 2√k/(1+k) − 1, where k is the price ratio.
Impermanent loss
IL = 2√k/(1 + k) - 1, with k = price now / price at deposit
Figures are estimates for planning only. Market returns are not guaranteed, and rates, limits and tax rules change. This is not financial or tax advice — speak to a qualified adviser before acting.
If the price returns to where you deposited, the loss disappears. It becomes permanent when you withdraw at a diverged price.
They can. A pool with high volume can earn more in fees than the divergence costs, which is the whole bet in providing liquidity.