> For the complete documentation index, see [llms.txt](https://cyelefi.gitbook.io/cyclefi-protocol/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://cyelefi.gitbook.io/cyclefi-protocol/products/pools.md).

# Pools

Within the Cyclefi ecosystem, liquidity pools play a pivotal role, forming the bedrock for the protocol's trading mechanisms. These pools are intricately designed to meet the diverse needs of liquidity providers (LPs) through the provision of two distinctive types of pools:

<mark style="background-color:purple;">Stable Pool</mark>: Tailored for users who prioritize stability and exhibit a risk-averse approach, these pools are backed by stablecoins like USDC, effectively mitigating the inherent volatility associated with cryptocurrency markets.

<mark style="background-color:purple;">Volatile Pool</mark>: Geared towards users seeking higher returns and comfortable with exposure to market volatility, these pools typically leverage more volatile assets such as ETH.

### Key Functions of Cyclefi Pools

&#x20;Liquidity Provision: LPs actively contribute to the pools, facilitating seamless trading on the platform, and in return, earn a portion of the trading fees as a reward for their liquidity contributions.

<mark style="background-color:purple;">Liquidity Curve</mark>: Cyclefi incorporates a dynamic liquidity curve that adjusts asset price quotes based on the available liquidity within the pool. This ensures fair and stable pricing, enhancing the overall trading experience.

<mark style="background-color:purple;">Revenue Distribution</mark>: Fees generated from trading activities are judiciously distributed among LPs, serving as a powerful incentive for their continued participation and contribution to the pool's liquidity.

<mark style="background-color:purple;">Managing Risk and Reward</mark>: Cyclefi's pools are meticulously crafted to strike a balance between the protocol's risk and offering competitive returns to liquidity providers. By actively participating in these pools, LPs contribute to the health and liquidity of the protocol, ultimately benefiting traders seeking efficient entry and exit points for their positions.


---

# Agent Instructions
This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com.

## Querying This Documentation
If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question.

Perform an HTTP GET request on the current page URL with the `ask` query parameter:

```
GET https://cyelefi.gitbook.io/cyclefi-protocol/products/pools.md?ask=<question>
```

The question should be specific, self-contained, and written in natural language.
The response will contain a direct answer to the question and relevant excerpts and sources from the documentation.

Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.