what is liquidity pool?

a pot of tokens (usually two) held in a smart contract that lets people trade between them.

a thin pool means even small sells move the price a lot. whoever can withdraw the pool's liquidity can pull the rug.

related words

honeypot a token contract that lets people buy but blocks or heavily taxes selling.
LP tokens the receipt for money put into a liquidity pool (on some exchanges an NFT); whoever holds it can withdraw that share.
rug pull when the people behind a token or project take the money and leave.

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checked 2026-10-20. education, not advice. found a mistake? see corrections.