This is a technical guide on how to use iZUMi Finance, specifically its flagship product, iZUMi LiquidBox, to enhance your yield on existing Uniswap V3 positions.
Step 1: Understand the Problem with Standard Uni V3 Farming
In a standard Uniswap V3 liquidity mining program, rewards are distributed across the entire price range of a pool. This is inefficient, as most trading happens in a tight range. Your LP NFT earns the same low reward rate whether it's providing active liquidity or not.
Step 2: The iZUMi LiquidBox Solution
iZUMi Finance Official allows projects to create targeted reward programs. They can set specific price ranges where bonus iZi token rewards are distributed. The LiquidBox dApp allows LPs to stake their Uni V3 LP NFTs into these targeted programs.
Step 3: Staking Your Uniswap V3 LP NFT
First, provide concentrated liquidity on Uniswap V3 as you normally would. You will receive an LP NFT.
Navigate to the iZUMi Finance dApp and go to the "LiquidBox" section.
Find a farming program that matches your Uni V3 pair.
Select a program where your LP NFT's price range overlaps with the incentivized range.
Stake your LP NFT into the iZUMi contract.
You will now earn your standard Uniswap V3 trading fees PLUS the targeted bonus rewards from LiquidBox. For a deep dive into the iZUMi Discretized Liquidity AMM model, see the Full Official Documentation.
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