How yield is generated

Liquidity providers (LPs) in Puzzle Ranges earn from swap fees. This model allows LPs to benefit from trading activity.

1. Swap fees

Every time a user makes a swap inside your pool — for example, exchanging one token for another — the protocol charges a fee (see Range Parameters > Swap Fee).

Half of the fee:

• Is collected in the token being sold

• Is distributed among all LPs proportionally to their active fact liquidity

💡 The more accurate your range and the larger your active liquidity — the more fees you earn.

2. External Rewards

Any user or external team can manually inject extra rewards into specific pools — increasing LP returns and boosting liquidity.

These rewards are distributed in addition to swap fees and staking income.

💡 This is especially useful for token teams whose assets are already listed in Ranges — they can incentivize volume without deploying a separate pool.