Risks
Market Risks: DeFi Pool Share operates on the Uniswap V3 platform, which is a decentralized exchange that operates without a central authority. This means that the liquidity of the pool can be affected by changes in market conditions and investor sentiment. Additionally, as the lending fee is based on estimated fees generated by the pool, there is a risk that the actual fees generated may be lower than expected, resulting in lower earnings for the lender.
Liquidity Risks: When lending your Uniswap V3 pool share NFT, there is a risk that there may not be enough liquidity in the pool to allow for easy exit from the loan. This can occur if there are no borrowers willing to bid on the pool share or if market conditions make it difficult to sell the underlying assets in the pool.
Concentrated Liquidity: When considering renting a Positions NFT on DeFi Pool Share, it is important for borrowers to check the current price range and the liquidity concentration of the NFT before making a bid. This information can be viewed directly on Uniswap (Uniswap pool links are linked on every Positions NFT available for borrowing on DeFi Pool Share) and is helpful to make an informed decision about the potential risks and rewards of borrowing a particular Position.
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