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Lifinity: Solana's Proactive Market Maker for LPs

⚠️ IMPORTANT: Lifinity is Winding Down

Lifinity is winding down. According to the official governance proposal, you must claim all your assets by December 31, 2026. After this date, all support will end, including the website and protocol functionality.

If you have assets on Lifinity, withdraw them immediately. This guide is preserved for historical reference only.

Lifinity was Solana's first oracle-powered Automated Market Maker (AMM) designed to maximize capital efficiency and significantly reduce impermanent loss through concentrated, lazy liquidity and oracle-driven rebalancing.

🔍 Why Choose Lifinity for Liquidity Provision?​

  • Oracle-Based Pricing: Uses Pyth oracles instead of relying on on-chain arbitrage, offering timely, manipulation-resistant pricing-helping protect LPs from loss.
  • Concentrated, Lazy Liquidity: Automatically focuses LP capital around active price ranges and minimizes the need for constant rebalancing.
  • Proactive Rebalancing: Delays trades in a way that captures market-making profits and refills liquidity-offsetting impermanent loss with fee gains.
  • Protocol-Owned Liquidity (POL): Lifinity holds much of its own liquidity, capturing a higher share of fees before redistributing back to users.

🧱 How to Provide Liquidity on Lifinity​

Protocol No Longer Active

Lifinity is no longer accepting new deposits. The protocol is winding down. If you have existing positions, you must withdraw them before December 31, 2026.

1. Select a Pool
Common pairs include SOL/USDC, ETH/USDC, BTC/USDC, and stable or token-native combinations like LFNTY/USDC.

2. Connect Your Solana Wallet
Supported wallets include Phantom, Solflare, and Trust Wallet.

3. Deposit Liquidity
Choose a price range (optional); otherwise, lifinity uses its lazy algorithm to handle positioning.

4. Receive LP Tokens
Hands-free LP-you earn fees automatically as swaps occur within your range.

5. (Optional) Stake LFNTY or VeLFNTY
Participate in governance or earn protocol revenue share with token staking.

⚠️ What You Need to Do Now​

If you have any assets on Lifinity (LP tokens, staked LFNTY, or VeLFNTY):

  1. Visit the Lifinity dashboard immediately
  2. Withdraw all your assets - LP positions, staked tokens, and any claimable rewards
  3. Complete withdrawals before December 31, 2026 - after this date, support ends
  4. Read the full governance proposal for complete details

💰 How You Earn on Lifinity​

  • Swap Fees: Earned when traders interact with your pool-which lifinity concentrates around your pricing tier.
  • Market-Making Profits: As the system rebalance, LPs may profit while IL is reduced.
  • Token Revenue Sharing: LFNTY holders receive a portion of protocol yields bought via Flares & protocol-owned liquidity.

⚠️ Key Risks & Trade-Offs​

Critical: Protocol Shutdown

The primary risk now is protocol shutdown. Lifinity is winding down operations. All users must withdraw assets by December 31, 2026, or risk losing access to their funds.

  1. Protocol Shutdown Risk ⚠️ CRITICAL
    Lifinity is winding down. Withdraw all assets immediately to avoid losing access after December 31, 2026.
  2. Smart Contract Risk
    The system was innovative but relatively new; no public audits noted.
  3. Opacity of Oracle-Based Strategies
    Less manual control may concern users who prefer full transparency over price setting.
  4. Low TVL Pools
    Smaller pools can suffer from less volume, which could reduce yield potential.
  5. Concentration Risk
    Automatic rebalancing won't help if the price drifts far outside your assumed range.

🧪 Strategy Example: SOL/USDC on Lifinity​

  • Pool Type: Concentrated, lazy LP with SOL/USDC

  • Approach:

    1. Deposit both tokens; Lifinity auto-focuses liquidity
    2. Fees captured via swap activity + rebalancing
    3. Potentially stake LFNTY to gain proportional protocol revenue

  • Why it works:

    • SOL/USDC has high volume
    • Oracle-driven pricing minimizes slippage
    • Protocol-owned liquidity boosts yield capture

🛠 Tools & Community Resources​

  • Official Docs: Lifinity/s GitBook provides protocol details.
  • Dashboard Insights: Metrics powered by Solana Compass & Lifinity App.
  • Community Feedback: Reddit users highlight high capital efficiency vs UI trade-offs.

Final Takeaways​

Protocol Status: Winding Down

Lifinity is no longer operational and is winding down. This guide is preserved for historical reference only. If you have assets on Lifinity, withdraw them immediately before December 31, 2026.

Lifinity was a promising platform for passive LPs seeking capital-efficient, low-maintenance strategies on Solana. Its use of oracle-based, concentrated pools helped reduce impermanent loss and earn fees efficiently. The protocol's unique tokenomics and revenue model made it an interesting experiment in market-making and staking mechanisms.

However, the protocol has announced its wind-down, and all users must claim their assets by December 31, 2026.

👉 For active Solana LPing, check out our Orca guide or Raydium guide, or deep dive into Solana strategies.