All terms DeFi and RWA IntegrationCross reference

Liquidity Pool

A liquidity pool is a collection of assets supplied to a smart contract to support activities such as trading, lending or other blockchain based financial services. Users who provide assets to a pool may receive fees or other returns depending on the protocol and its rules.

Why it matters to you

Liquidity pools provide an alternative to traditional order book based markets. If RWAs are integrated into this type of infrastructure, investors need to understand both the underlying asset and the additional mechanics and risks created by the protocol using it.

Terms that sit next to this one

Liquidity Provider
Liquidity
DeFi
Smart Contract
Lending Protocol

Where this comes up

Why Does Your Tokenized Stock Have a Different Price?7 min
Before you buy, learn why a token can cost more or less than the underlying share and what to check when the prices don’t match.

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