Outsmart LP Farming

Manage LP positions on Solana DEXes to earn swap fees. Use when: user asks about LP farming, providing liquidity, earning yield, compounding fees, DLMM, DAMM...

LP Farming

You earn money by providing liquidity to pools. Every time someone swaps through your pool, you get a cut. Two protocols, two completely different games.

When to Use

• "Farm yield on Solana"
• "Add liquidity to a pool"
• "Create a new pool"
• "Rebalance my LP"
• "Claim my fees"
• "DLMM vs DAMM v2?"

When NOT to Use

• Staking SOL for validator rewards — different system
• Lending/borrowing (Marginfi, Kamino) — different protocols
• CEX market making — this is on-chain only

DLMM vs DAMM v2

DLMM is for mature tokens. Concentrated bins, you pick the price range, you actively manage. Token needs 30+ min of real volume. Costs ~0.2 SOL. If price moves out of range, you're 100% in the losing side.

DAMM v2 is for fresh launches. Full range, set-and-forget, decaying fee schedule. The alpha: be the first person to create the pool — you set 99% starting fee and capture everything. Costs ~0.02 SOL.

	DLMM	DAMM v2
When	Token age >30 min	Token age <5 min
LP style	Concentrated bins	Full range
Fees	Fixed fee tier	Decaying (99% start -> 2% end)
Alpha	Tight bins = max capture	First pool creator = everything
IL	Binary: in range or fully single-sided	Standard AMM: gradual
Cost	~0.2 SOL	~0.02 SOL

DLMM Commands

Add liquidity (3 strategies)

# Spot: even distribution (good default)
outsmart add-liq --dex meteora-dlmm --pool POOL --sol 0.5 --strategy spot --bins 50

# Curve: concentrated near active bin (stable pairs)
outsmart add-liq --dex meteora-dlmm --pool POOL --sol 0.5 --strategy curve --bins 30

# Bid-Ask: more at edges (volatile pairs)
outsmart add-liq --dex meteora-dlmm --pool POOL --sol 0.5 --strategy bid-ask --bins 40

One-sided positions

# SOL below price = buy wall (DCA in while earning fees)
outsmart add-liq --dex meteora-dlmm --pool POOL --sol 0.5 --token-amount 0 --strategy spot --bins 40

# Token above price = sell wall (DCA out while earning fees)
outsmart add-liq --dex meteora-dlmm --pool POOL --sol 0 --token-amount 1000 --strategy spot --bins 40

Rebalancing

outsmart claim-fees --dex meteora-dlmm --pool POOL
outsmart remove-liq --dex meteora-dlmm --pool POOL --pct 100
outsmart quote --dex meteora-dlmm --pool POOL
outsmart add-liq --dex meteora-dlmm --pool POOL --sol 0.5 --strategy spot --bins 50

Don't rebalance for small moves — each cycle costs ~0.005-0.02 SOL.

DAMM v2 Commands

First pool creator play

# Check if pool exists
outsmart find-pool --dex meteora-damm-v2 --token TOKEN_MINT

# If not found, create with 99% starting fee
outsmart create-pool --dex meteora-damm-v2 --token TOKEN_MINT \
  --base-amount 1000000 --quote-amount 0.5 \
  --max-fee 9900 --min-fee 200 --duration 86400 --periods 100

Day-to-Day Workflow

# 1. Find opportunity (volume/liquidity > 1.0 = good fees)
outsmart info --token TOKEN_MINT

# 2. Check pool
outsmart quote --dex meteora-dlmm --pool POOL

# 3. Add LP
outsmart add-liq --dex meteora-dlmm --pool POOL --sol 0.5 --strategy spot --bins 50

# 4. Monitor
outsmart list-pos --dex meteora-dlmm --pool POOL

# 5. Claim fees
outsmart claim-fees --dex meteora-dlmm --pool POOL

# 6. Exit
outsmart remove-liq --dex meteora-dlmm --pool POOL --pct 100

Risk Management

• DLMM IL is binary: in range or fully single-sided. Use wider bins (50+).
• DAMM v2 IL is standard AMM. Offset by high initial fees if you're first LP.
• Only LP tokens with >$100k liquidity, >24h age, organic buyers.
• Budget ~0.05 SOL for a full LP cycle. Keep 0.1 SOL gas reserve.