Overview
Centralized exchange (CEX) trading is typically powered by a central limit order book (CLOB), where buyers and sellers place orders that are matched by the exchange.
Most decentralized exchanges (DEXs) work differently.
Instead of order books, DEXs use liquidity pools — shared pools of tokens supplied by users, which ensure there is always liquidity available for traders to buy and sell an asset.
When you provide liquidity:
- You deposit two tokens into a liquidity pool (for example, WGC + ETH or WGC + USDC)
- Those tokens are used by the DEX to facilitate swaps between traders
- You earn a proportional share of swap fees, based on your contribution to the pool
Unlike centralized market making, liquidity provision on DEXs is non-custodial, permissionless and governed entirely by smart contracts.
About this walkthrough
This guide focuses specifically on Uniswap V3 liquidity provision, which supports both full range and concentrated liquidity positions.
While the exact interface and terminology may vary slightly between DEX platforms, the core concepts are broadly consistent.
If you are using a DEX with a different liquidity provision model, refer to that platform’s documentation for any chain- or protocol-specific differences.
What you’ll need
- A supported wallet (e.g. MetaMask, Coinbase Wallet)
- WGC on the chain you wish to provide liquidity on
- The paired asset (e.g. ETH, USDC, HYPE)
- A small amount of the chain’s native gas token
Provide liquidity on Uniswap V3
Open the Uniswap interface
Visit https://app.uniswap.org.
Always verify the URL before connecting your wallet.
Connect your wallet
Click Connect Wallet and select your wallet provider.
Ensure your wallet is connected to the correct network where you want to provide liquidity.
Open the pool interface
From the Uniswap navigation:
- Select Pool
- Click New Position
This starts the Uniswap V3 liquidity position flow.
Select the token pair
Choose:
- WGC as one token
- A paired asset (e.g. ETH, USDC)
If a pool for this pair and fee tier does not already exist, creating a position will automatically deploy a new pool.
Choose a fee tier
This is the fee traders pay on each swap, commonly:
- 0.05% for lower volatility pairs
- 0.3% for most standard pairs
- 1% for higher volatility pairs
The interface may suggest a default option.
Set your price range
Uniswap V3 offers both concentrated liquidity and full-range liquidity positions:
- Full Range covers the entire possible price range
- Concentrated ranges cover a specified price range, enabling more efficient use of liquidity
Your position only earns fees while price remains within your selected range.
Enter deposit amounts
Enter the amount of one token you wish to deposit.
Review and confirm
Review:
- deposited token amounts
- selected fee tier
- price range
- estimated position value
Approve token spending if prompted, then confirm the transaction in your wallet.
Once confirmed, your liquidity position will be active.
After providing liquidity
- You earn a share of trading fees generated by the pool
- Your position can be viewed in the Pools / Positions section of Uniswap
- You can add, remove, or adjust liquidity at any time
Liquidity positions on Uniswap V3 are represented by NFTs, each corresponding to a specific fee tier and price range.
Risks to be aware of
Providing liquidity involves risk, including:
- Impermanent loss
- Price volatility
- Smart contract risk
Liquidity provision is best suited to users who understand these risks and are comfortable interacting with DeFi protocols.