Glossary
Every entry below is one of the hard terms the editorial standard requires a plain-language gloss on first use. Each definition links to the guide that works the idea through with numbers.
The pattern where informed traders trade against a pool precisely when the pool is wrong. The pool keeps selling the asset that is about to rise, which is why raw volume overstates the value of flow to a liquidity provider.
Full treatment in MEV and Liquidity Providers.
A trader who closes a price gap between venues. On an AMM the arbitrageur is the counterparty that reprices a stale pool, and the cost of that repricing is the liquidity provider’s loss against a rebalancing benchmark.
Full treatment in Loss-Versus-Rebalancing.
One hundredth of one percent: 0.01%. Fee tiers, bin steps and APR differences are quoted in basis points so that 30 bps and 33 bps stay distinct.
Full treatment in Uniswap Fee Tiers Explained.
The rule that maps reserves to price inside a pool. The constant product curve x × y = k is one bonding curve; stableswap and concentrated ranges are others. The shape decides how much price moves for a given trade.
Full treatment in Bonding Curves and AMM Invariants.
A pool that prices trades by keeping a mathematical function of its reserves constant. Every swap moves along the curve defined by that function; the function is the pricing rule.
Full treatment in The Constant Product Formula.
Liquidity that an LP binds to a price band instead of the full range. Capital inside the band is denser and earns fees only while price stays there; outside the band the position holds one asset and earns nothing.
Full treatment in Concentrated Liquidity Explained.
The shortfall of a pool position against holding the same assets untouched, measured at entry and exit prices. It is the endpoint arithmetic that the phrase “impermanent loss” usually refers to.
Full treatment in Impermanent Loss Explained.
A multi-token balance standard used inside Uniswap v4’s singleton so one contract can track many token balances. Position claims themselves remain NFTs from the position manager; ERC-6909 is for balances, not positions.
Full treatment in Uniswap v4 Architecture.
The NFT standard. Uniswap v3 and v4 liquidity positions are ERC-721 tokens: each position is its own non-fungible claim with its own range, fees and history.
Full treatment in Uniswap v3 Ticks and Position NFTs.
Settlement that records net balance changes during a transaction and transfers only the net amounts at the end, instead of moving tokens at each hop. It is why multi-pool routes in Uniswap v4 cost far less gas.
Full treatment in Uniswap v4 Architecture.
Contracts attached to a Uniswap v4 pool at creation that run at defined lifecycle points—before or after a swap or a liquidity change. A pool inherits the trust assumptions of its hook.
Full treatment in Uniswap v4 Architecture.
The gap between a pool position and holding the deposited assets, arising because the pool rebalances as price moves. “Impermanent” is misleading: the gap is realisable the moment you withdraw.
Full treatment in Impermanent Loss Explained.
The quantity a pool’s rule preserves across trades—most often the product of reserves. Swaps change the reserves but leave the invariant intact; fees are what grow it.
Full treatment in Bonding Curves and AMM Invariants.
A signed statement of what a user wants to achieve, left for someone else to execute. Solvers compete to fill intents, which can route around thin pool depth rather than through it.
Full treatment in Onchain Liquidity Explained.
The receipt a liquidity provider receives for a deposit. In full-range pools it is a fungible share of everything in the pool; in concentrated pools the position is usually an NFT instead.
Full treatment in Liquidity Pool Tokens Explained.
The shortfall of an AMM position against a strategy that rebalances to the same portfolio at market prices. It measures the cost of letting arbitrage trade against you, not the cost of a single round trip in isolation.
Full treatment in Loss-Versus-Rebalancing.
Value extracted by choosing, ordering or censoring transactions in a block. For liquidity providers it shows up as sandwiches, JIT fills and toxic arbitrage against stale pool prices.
Full treatment in MEV and Liquidity Providers.
The set of pending transactions waiting to be included in a block. What is visible there is what searchers can reorder around—and what a sandwich attack needs to see before it strikes.
Full treatment in MEV and Liquidity Providers.
An onchain data feed that reports an external price or state. Pools and vaults that lean on an oracle inherit its delay, its failure modes, and whoever can influence it.
Full treatment in Liquidity Pool Risks.
The peg is a stablecoin’s intended one-to-one price; a depeg is when it trades away from that price. Stable pools are built around the peg and change character the moment it breaks.
Full treatment in Stablecoin Liquidity Pools.
How far a trade moves the pool’s own price because it consumes depth. It is a property of trade size relative to liquidity—not a fee, and not the same as slippage.
Full treatment in Slippage and Price Impact.
Two transactions placed around a victim’s trade—front-run before, back-run after—so the victim pays a worse price and the attacker captures the difference.
Full treatment in MEV and Liquidity Providers.
A single contract that holds many pools. Uniswap v4’s PoolManager is a singleton: one address owns every pool’s state, which is what makes multi-hop settlement cheap.
Full treatment in Uniswap v4 Architecture.
The difference between the price you expected and the price you actually got, after price impact, routing and any pending moves in the market. It is measured on the fill, not on the quote.
Full treatment in Slippage and Price Impact.
An offchain searcher that competes to execute a user’s intent. Solvers turn signed goals into concrete transactions, which is one way liquidity can be assembled across venues without routing through a single pool.
Full treatment in Onchain Liquidity Explained.
The discrete price boundary Uniswap v3 divides the price axis into. Liquidity is allocated between ticks; crossing a tick converts inventory from one asset to the other.
Full treatment in Uniswap v3 Ticks and Position NFTs.
Contract storage that exists only for the duration of one transaction (EIP-1153). Uniswap v4 uses it to hold net balances during flash accounting, then clears them before the transaction ends.
Full treatment in Uniswap v4 Architecture.
The dollar value of assets deposited in a protocol or pool. It is a context metric: high TVL does not mean depth at the price where trades actually happen.
Full treatment in TVL Explained.
Missing a term you met in a guide? Write to research@liquiditypools.app and we will add it with its sources.