Polkaswap DEX Liquidity Guide
Learn how to add Liquidity to trading pairs on Polkaswap and start earning passive income paid in PSWAP rewards
New Liquidity mining rewards for UMI/XOR Pair are coming soon so now is a good time to learn how to add liquidity to Polkaswap Decentralized exchange. At the moment you can earn a percentage of DEX fees paid out in PSWAP rewards. In the future you will be able to earn $PSWAP and $UMI for providing liquidity on the UMI/XOR pair.
Step 1: Connect to Polkaswap.io
First visit the https://polkaswap.io website using a web browser with Polkadot.js extension installed. If you do not know how to install Polkadot.js then follow this guide here.
Click ‘Connect Account’ in the top right-hand corner of the screen.
Select the Sora Network account you wish to use, you can have as many accounts as you want with a DEX and there is no KYC.
Step 2: Add Liquidity to Pool
Click “Pool” in the left-hand menu and go to the Liquidity Pool management page.
Now in the Pool management page, left mouse Click “Add Liquidity” to start the process of adding Liquidity.
In the ‘Add Liquidity’ page, you can now select the token which you wish to add liquidity towards by clicking the “Choose Token” button as shown below.
Select the token you would like to pair with XOR and add liquidity to the Pool.
A list of tokens will pop up; now you can then select the token you want (by left mouse clicking it) from the list. You can also filter the list by typing in the name, asset ID or symbol of the token. In this case we are selecting UMI.
Next you must input the amount of each token that you wish to supply to the liquidity pool. Simply typing the amount, you want to supply in either field will auto-populate the correct amount in the second field so there is no need to do any math calculations here; Polkaswap does the calculation for you instantly.
If you want to add the maximum possible amount then simply click the green “MAX” button. Important point to remember, you must add equal amounts of each token to the pool (i.e. $500 usd worth of UMI and $500 usd worth of XOR).
Once you have the correct amounts for each token, the next step is to click the ‘SUPPLY’ button. After clicking “SUPPLY”, a confirmation screen will pop up asking you to confirm that everything is indeed correct and you want to proceed.
It will give you a summary of the exact amounts of tokens you are supplying and the corresponding values in USD. An estimate of your future pool position will be displayed. In this example we will be supplying liquidity for 1.3379008% of the total pool amount. Click confirm and then a second popup will appear asking for authorisation via the Polkadot.js wallet.
You must type in your password and sign the transaction to proceed. Congratulations, you just supplied liquidity to a pool on Polkaswap!
After successfully supplying liquidity, you will be able to see your LP share in the Pool menu as shown below. At any time, you can instantly remove your liquidity (or add more) and recover both tokens as there is no lockup involved in supplying liquidity on Polkaswap.
Step 3: Claiming Rewards
Providing liquidity on Polkaswap generates rewards in the form of PSWAP which are paid out daily to your account. In the future, adding liquidity to UMI/XOR pair will generate UMI and PSWAP rewards. The rewards can be claimed at any time by following these steps.
Click ‘REWARDS’ on the Right-hand menu as shown below:
You will be taken to the Rewards screen which shows the rewards your account has gained from the provision of liquidity on Polkaswap. This is the amount of PSWAP your account currently has available to claim.
Click the “SIGN AND CLAIM” button and then authorise the transaction on Polkadot.js wallet to receive the rewards in your account instantly.