Single-Sided Liquidity Explained: LP With One Token (2026)

Last updated: 4 October 2026

Single-sided liquidity means providing liquidity to a pool with only one token instead of a matched pair. The protocol either pairs your token for you, swaps part of it behind the scenes, or places it in a price range where only that one asset is needed. You still earn fees, but the risk you carry depends heavily on which of those designs you are using: some remove impermanent loss entirely, some only postpone it, and some quietly convert half your deposit into the other asset.

Providing liquidity has traditionally meant bringing two assets in equal value. If you wanted trading fees, you needed both sides of the pair. That requirement is a real barrier: it forces you to hold assets you may not want, exposes you to impermanent loss on both legs, and complicates the simple act of putting capital to work. Single-sided liquidity removes it. You deposit one token, and the protocol handles the rest.

This guide covers what single-sided liquidity actually is, the mechanisms protocols use to deliver it (including Bancor-style pools, concentrated-liquidity range orders and one-click "zaps"), where you can use it today, what risk replaces impermanent loss, a worked example with numbers, and how JewelSwap applies it to NFTs on MultiversX.

What single-sided liquidity means

In a classic automated market maker, a liquidity pool holds two tokens and their relative balance sets the price. To become a liquidity provider you deposit both in the required ratio, and you earn a share of trading fees. This is the model early AMMs popularised, and it still dominates DeFi.

Single-sided liquidity, also called one-sided liquidity or single-sided staking, lets you deposit a single asset. You bring one token; the protocol supplies or simulates the other side. The LP decision collapses to one question: how much of one asset to commit.

Bancor's documentation describes the problem it set out to solve in plain terms: in a typical pool, if you wish to deposit one token you "would be forced to sell 50% of that token" for the other, whereas its single-side design lets providers supply only the token they hold and collect fees in that token (Bancor docs, accessed 4 October 2026).

The mechanisms behind it

"Single-sided" describes a user experience, not one technique. Underneath, protocols achieve it in a handful of distinct ways, and the differences determine your risk.

1. Range-edge deposits in concentrated liquidity

In a concentrated-liquidity AMM you choose a price range rather than providing across the whole curve. Set a range entirely above the current price and the position consists only of the asset being sold; set it entirely below and it holds only the base currency. You have deposited one token — but the moment price moves into your range, the position converts. This is single-sided at entry and two-sided in outcome. It is the most common form and the most misunderstood.

Uniswap formalises this as the range order: in Uniswap v3 and v4 "you can approximate a limit order by providing a single asset as liquidity within a specific range," with the target asset available once the spot price crosses the full range. The catch, in Uniswap's own words, is that a range order "will be unfilled if the spot price crosses the given range and then reverses to recross in the opposite direction before the target asset is withdrawn" (Uniswap developer docs, accessed 4 October 2026). On Sui, the same idea applies to CLMM DEXs such as Cetus; our concentrated liquidity (CLMM) explainer covers how ticks and ranges work.

2. Protocol-paired liquidity (the Bancor-style model)

Some designs accept your single token and pair it with liquidity the protocol itself supplies. You keep exposure to your deposit; the protocol absorbs the other leg and takes a share of fees for doing so. Impermanent loss is genuinely reduced here, because you never held the second asset. Bancor is the best-known example: its V3 documentation describes "Single-Sided Liquidity Provision and Liquidity Protection for any listed token" (Bancor V3 docs, accessed 4 October 2026). The trade-off is that the protocol becomes your counterparty: any protection you are promised is only as good as the protocol's own balance sheet and governance.

3. Zaps and single-token joins

The answer to the common question "is there a platform that lets me enter an LP with one token?" is usually a zap. You deposit one token, and a contract swaps roughly half of it into the other asset and adds both to a normal two-sided pool in one transaction. Weighted-pool AMMs offer a native version: Balancer's vault supports unbalanced and single-token adds, and its documentation notes that non-proportional operations are where swap fees and price impact apply (Balancer docs, accessed 4 October 2026).

Be clear about what a zap is: single-sided at the button, two-sided in the pool. You pay a swap fee and price impact on the converted half, you are exposed to slippage, and from then on you carry ordinary impermanent loss.

4. Naturally one-sided venues

Lending markets are the original single-sided venue: supply one asset, earn a rate, no pair involved. Liquid staking is the same shape — deposit SUI, EGLD or XRD and receive a liquid staking token that accrues value. There is no second asset and therefore no divergence to lose to. Most people using "single-sided" products in practice are using these.

Where you can actually provide single-sided liquidity

Venue type	What you deposit	Impermanent loss?	Main risk
Concentrated-liquidity range edge	One token at a range boundary	Yes, once price enters the range	Position converts to the other asset
Zap into a two-sided pool	One token, half swapped for you	Yes, from the moment of deposit	Swap cost, price impact, ordinary IL
Lending market	One asset	None	Borrower default, bad debt, utilisation spikes
Liquid staking	One native token	None	Slashing, LST depeg, unbonding delay
Protocol-paired pool	One token	Reduced	The protocol is your counterparty
NFT single-sided pool	Base currency or NFTs	Not in the classic form	Directional: laddering into a falling floor

What replaces impermanent loss

Impermanent loss needs two moving assets to bite. Remove one and the classic divergence largely disappears — but the risk does not vanish, it changes shape.

With a single asset quoting one direction, your exposure becomes directional. Fund buy orders with a base currency and the asset keeps falling, and you accumulate a position worth less than the currency you spent. List assets to sell and the market runs after your lowest asks fill, and you sold into strength below where you could have.

These are real risks, but they are more intuitive than two-sided divergence and more controllable — you choose the ladder, the range and the size. The honest framing: single-sided liquidity trades one exposure for another that most providers find easier to reason about. For the mechanics of the loss it avoids, see our breakdown of impermanent loss and how to calculate it.

Worked example: one token, three designs

Numbers make the differences concrete. Assume you hold 1 ETH worth 2,000 USDC and want to earn fees without buying USDC first. Fees are ignored so the price effects are visible; the arithmetic uses the standard constant-product formula.

Zap into a 50/50 pool

The zap sells 0.5 ETH for 1,000 USDC and deposits 0.5 ETH + 1,000 USDC. If ETH then doubles to 4,000, the pool rebalances to about 0.354 ETH + 1,414 USDC, worth roughly 2,828 USDC. Holding the 50/50 mix would be worth 3,000; holding your original 1 ETH would be worth 4,000. If ETH instead halves to 1,000, the position is worth about 1,414 USDC versus 1,500 for the 50/50 mix and 1,000 for the plain ETH. The zap cushions the downside and caps the upside, because half your ETH was sold on day one.

Range order above the price

Place your 1 ETH in a range from 2,100 to 2,200 USDC. While ETH stays below 2,100 you hold pure ETH and earn nothing. If ETH climbs through the range, your ETH is converted along the way and, once price is above 2,200, you hold roughly 2,149 USDC (the geometric mean of the range) plus fees. If ETH then falls back through the range before you withdraw, you are returned to ETH, exactly the caveat Uniswap documents.

NFT buy pool (directional)

On JewelSwap's NFT AMM, the documented buy-pool ladder places five bids at 5, 4.5, 4.05, 3.645 and 3.2805 EGLD. If all five fill, you have spent 20.4755 EGLD for an average of about 4.10 EGLD per NFT. If the collection's floor then settles at 3 EGLD, the five NFTs are worth 15 EGLD — a 26.7% mark-to-market drawdown. No impermanent loss, but plenty of directional risk.

How JewelSwap uses single-sided liquidity for NFTs

JewelSwap brings the AMM model somewhere it rarely reaches: NFTs. Its NFT AMM/DCA modules on MultiversX let users trade NFTs against liquidity pools much as you would swap tokens on a DEX, with the priced asset being an NFT collection rather than a fungible token.

JewelSwap supports both two-sided and single-sided pools. Two-sided pools facilitate classic NFT-to-EGLD market making. Single-sided pools serve dollar-cost-averaging strategies without the two-asset impermanent-loss exposure; the documentation states that these single-sided pools "do not suffer from impermanent loss" (JewelSwap docs, NFT AMM/DCA introduction, accessed 4 October 2026).

Buy pools and sell pools

Buy pools: you provide EGLD to place multiple purchase bids. It is a buy pool because you, the creator, want to buy NFTs. Prices step down as the ladder fills.
Sell pools: you provide the NFTs you wish to sell. Prices step up, adjusting only after each NFT sells.

Pricing is set automatically using delta parameters, either exponential (percentage-based) or linear (fixed amount). The documentation gives a worked buy-pool example with an exponential delta: five bids at 5, 4.5, 4.05, 3.645 and 3.2805 EGLD. Each step is 10% below the last, so your capital buys progressively cheaper as the market moves toward you. Its sell-pool example uses a linear delta of 0.5 EGLD instead: five NFTs listed at 5, 5.5, 6, 6.5 and 7 EGLD.

Why this is dollar-cost averaging

The laddered structure is what makes these pools a DCA tool. Instead of buying or selling a whole position at one price, the pool spreads execution across levels, reducing the impact of volatility. A buy pool accumulates quietly as prices fall through your ladder; a sell pool distributes as prices rise through your asks. Same logic as dollar-cost averaging into tokens, applied to NFTs and automated onchain.

Fees

JewelSwap's 1% platform fee is deducted from pool creator profits rather than from trading volume. In two-sided pools participants also earn EGLD trading fees as market makers, and the creator sets their own fee per transaction. Primary source: the single-sided liquidity pools documentation.

Single-sided vs two-sided: which should you use?

You want to accumulate or exit one asset at set prices: range orders or NFT buy/sell pools fit, because they behave like laddered limit orders that earn fees while they fill.
You want fee income on an asset you plan to keep: a naturally one-sided venue (lending, liquid staking) avoids divergence altogether; a zap does not.
You are comfortable holding both assets: a two-sided pool earns two-way fees continuously, and you accept impermanent loss as the cost. Our guide to starting yield farming step by step walks through that route, and liquidity mining explains the incentive layer on top.
You are offered "single-sided with protection": read who pays for the protection. If it is the protocol, you have swapped market risk for protocol risk.

The risks, stated plainly

Single-sided pools reduce the classic two-asset dynamic; they do not remove market risk. JewelSwap's documentation is direct: impermanent loss stems from price movement after deposit and matters most in two-sided pools, where rebalancing can leave you EGLD-rich or NFT-rich. LPs can still profit despite it, provided fees earned exceed value lost.

For single-sided pools the exposure is directional. A buy pool filling as a collection craters leaves you holding NFTs bought above the new floor. A sell pool emptying into a rally means you sold below the top. NFT markets are thinner and more sentiment-driven than token markets, so floors move fast. Commit only what you can hold through a full cycle, and choose your delta and range deliberately.

Across every design, the usual DeFi risks still apply: smart-contract bugs, oracle or pricing errors, and the governance of whoever controls the pool parameters.

Frequently asked questions

What is single-sided liquidity in simple terms?

Providing liquidity with one asset instead of a matched pair. You commit one token, the protocol handles market-making on the other side, and you skip sourcing and balancing a second asset.

Does single-sided liquidity eliminate impermanent loss?

It depends on the mechanism. In lending and liquid staking there is no second asset, so there is no impermanent loss at all. In a concentrated-liquidity range-edge position there very much is — your single token converts to the other asset as price crosses your range. Protocol-paired pools sit in between.

Is a zap the same as single-sided liquidity?

Only at the deposit step. A zap swaps part of your single token into the other asset and adds both to a normal two-sided pool, so you pay a swap fee and price impact and then carry ordinary impermanent loss like any other LP.

How is a single-sided pool different from a two-sided pool?

A two-sided pool needs both assets and rebalances between them as trades flow, creating impermanent loss but earning continuous two-way fees. A single-sided pool needs one asset and quotes one direction at a time, concentrating exposure in the asset you chose.

Is a range order the same as a limit order?

Close, but not identical. A range order earns fees while it fills, but if price crosses your range and then reverses before you withdraw, the position converts back, so you must withdraw once it is filled to lock in the result.

What is a buy pool versus a sell pool on JewelSwap?

A buy pool is funded with EGLD and places bids at descending prices because the creator wants to buy NFTs. A sell pool is funded with NFTs and lists them at ascending prices, stepping up only after each sale.

Is JewelSwap available on chains other than MultiversX?

JewelSwap operates on MultiversX, Sui and Radix. The NFT AMM/DCA modules described here run on MultiversX; liquid staking and yield farming span all three.

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Viktor Vostrikov

Co-Founder

About the author.

Co-Founder at JewelSwap & Chief Strategy Officer at iDenfy. Viktor brings his successful track record of superb development & project management.