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    IL Insurance

    THORSwap, the main DEX of THORchain has a special feature that makes providing liquidity on THORSwap very attractive; which is the Impermanent Loss Insurance where the liquidity you provided will have no impermanent loss (terms and conditions applied). Impermanent loss is when you provide to an LP which is usually in a pair of different asset (even when you provide asymmetrically because the protocol will split the amount into two assets), when one of the asset's price go up, it will sell some to buy the other asset so that it maintains 50-50 distribution among the pair. Hence, you will lose some money when compared to you just holding the 2 assets in your wallet. The insurance will be paid whenever you remove the liquidity. So, in this dashboard, we will take a look at the metrics of withdraw LP and how many of them received the IL insurance. (Data taken for transaction on April 10th and onwards).

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    For the past few days, there has been 517 LP withdrawal transactions with TERRA.UST has the most, followed by BNB.BUSD and then Terra.LUNA.

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    So out of 517 withdraw LP transaction, only 126 of them eligible to be paid IL insurance. Graph below shows the distribution of tx count by pool name. There are few pools where all transactions did not receive IL such as AVA, TWT on Binance Chain, DAI, HOT, SNX, USDT and XRUNE on ETH.

    In conclusion, there are terms and condition to be eligible for the Impermanent Loss insurance on Thorswap such as you need to provide for 100 days to be 100% protected etc. However, even though you won't be 100% protected from impermanent loss, this IL protection offer definitely better than providing LP to most other protocol.