FAQ

**Latest version 2021/07/08

What is Multiple Protocol？

Multiple Protocol is a DeFi protocol based on Ethereum that allows GP to provide professional AMM liquidity strategies which in turn ensures LP securely benefit from the best yielding products.

Why do we need GPs？

Uniswap v3 allows liquidity in a narrower range, leading to more LP fees than v2. We’ve found that the liquidity chart shows a peak shape based on the current price, which means that most of users who want to earn LP fees will provide liquidity near the current price range.

If the current price is outside of the price range that you set, LPs will not gain LP fees. Positions outside of the range will have to wait until the price is within the range again. Or it is acceptable to remove liquidity once and provide it within another range.

LPs need to keep a close eye on price changes all the time and adjust their positions accordingly. That’s why providing liquidity is time-consuming and requires high trading skills. Ordinary LPs are usually not sensitive to market risks and have access only to single means of risk control and hedging.

Therefore, professional GPs are needed to perform technical operations and provide strategies for liquidity management. Their competence will determine the profitability of their positions.

How feasible the GP strategies are？

In terms of the liquidity strategies, the best range is to approach the future price range as close as possible.

If only the impermanent loss is considered, it is better to set the range as broad as possible, such as v2 LP. As such, every GP will adopt different strategies to select the range. However, we have no clue that which GP’s strategy has better performance until we uncap the bottle.

What tools are available for GPs at Multiple?

At present, Performance (Return Chart), Report (Position Chart), RiskManagement (Risk Hedging) and Historical Volatility (Trading Pair Volatility) are available for GPs to analyze their operations and make decisions.

In addition, it’s necessary to remove old position and create a new one for liquidity change in Uniswap v3. By contrast, it’s easier for you to directly change the price range provided by the current position in Multiple Protocol.