How the range works
You set a lower and an upper price. While the market price stays inside, your position quotes and earns your fee on every fill. The tighter the range, the more of your liquidity is active at the current price, and the more fees the same tokens earn.
At the edge
When price crosses your range, the position holds more of one token and stops quoting until price returns. The token it ends up holding is the one that lost value against the other. Nothing is liquidated: it simply waits. You can close and reopen a different range at any time. Closing is one transaction and moves no tokens.
- Tight range: highest fee density, needs attention as price moves.
- Wide range: fewer adjustments, lower fee density.
- Full range: never out of range. That tier runs the XYC builder.
In a study of 17 large Uniswap v3 pools, 49.5% of the liquidity providers analyzed collected less in swap fees than impermanent loss cost them. See every risk, side by side.
