Impermanent loss
Plain definition. Impermanent loss is the difference in value between providing liquidity and simply holding the same deposited tokens in your wallet, according to Orca’s documentation.
Technical definition. In Orca’s documentation, impermanent loss (IL), which Orca also calls divergence loss (DL), describes the gap between providing liquidity and simply holding the deposited tokens, caused by the prices of the deposited assets diverging from their original ratio. In an AMM, withdrawing at a different price ratio than at deposit can leave the LP position worth less than holding the same tokens, and that difference is realized on withdrawal. In concentrated liquidity pools, allocating liquidity within a selected price range can increase exposure to price movement, and fees and rewards may offset some or all of IL, though neither is guaranteed.
On this site
On this site, Impermanent loss comes up in What are the risks of earning yield on XRP through AMM pools or wrapped XRP?.
Source
Impermanent Loss - Orca Documentation Documentation Index Fetch the complete documentation index at: /llms.txt Use this (docs.orca.so), read October 1, 2026.