80%+ Win Rate DLMM Strategy | Single Sided LP Farming

Summary

This video demonstrates a strategy for one-sided liquidity provision in Solana, focusing on managing potential losses and profiting from market fluctuations. The speaker emphasizes the importance of selecting pools with at least a 1-2% fee to offset losses, and shares their approach of providing liquidity all the way to the bottom of a token's price movement. By observing token behavior and using a low-risk method, the technique aims for small but consistent profits with minimal losses. The speaker also discusses compounding, daily adjustments, and long-term strategy with an 80% success rate for this approach.

Takeaways

• 📉 The strategy focuses on minimizing downside risk by setting liquidity ranges as low as -98%, allowing survival even if the token crashes.
• 💰 Profit is primarily generated from trading fees (1–5%), not from the token increasing in price.
• ⚖️ One-sided liquidity (using SOL or USDC) reduces exposure to risky tokens while still capturing fee income.
• ⏳ Patience is critical—positions should be left alone instead of constantly adjusting ranges based on short-term price movements.
• 📊 It is possible to remain profitable even when a token drops significantly (e.g., 30–50%) due to accumulated fees.
• 🚫 Token selection matters—if a token lacks potential, it’s better to exit early with small profits and rotate capital.
• 🔁 Compounding can enhance returns by reinvesting earned fees or converting rewards strategically.
• 📈 The strategy has a claimed high win rate (~80%), but profits are typically small unless larger capital is used.
• ⚠️ Risks still exist, including rug pulls and capital being locked in positions for extended periods.
• 🎯 The goal is consistent small gains (e.g., 3–4% daily), which can grow significantly when compounded over time.
• 🧠 Experience improves decision-making, especially in judging whether a token is worth holding or exiting.
• 💼 Scaling the strategy requires larger investments, as small capital yields minimal profits despite consistent wins.

Q & A

What is the main objective of the one-sided liquidity strategy discussed in the video?

The main objective is to minimize losses while potentially profiting from token price declines by using a one-sided liquidity position, primarily with Solana or USDC, collecting fees to offset downward movements.

Why does the speaker recommend using a high-fee pool?

A high-fee pool (1–5%) is important because the collected fees can help offset losses if the token price falls, providing a safety net for the liquidity provider.

What does 'minus 98%' mean in the context of this strategy?

'Minus 98%' refers to setting the liquidity range to cover nearly the entire potential downside of a token, allowing the position to remain profitable or at least break even even if the token loses up to 98% of its value.

How does the speaker recommend starting this strategy?

The speaker advises starting with small amounts, testing across multiple tokens (e.g., 10 tokens), and gradually increasing the allocation once confident in the method, to minimize risk while learning the strategy.

Why is patience emphasized when implementing this strategy?

Patience is crucial because the token may take time to move into the active range, and constant repositioning is inefficient. Waiting allows fee collection and reduces unnecessary trading errors.

What role does compounding play in this strategy?

Compounding allows the trader to reinvest earned fees and small profits back into the liquidity position, gradually increasing overall returns over time while maintaining low risk exposure.

Can this strategy be applied to assets other than Solana or USDC?

Yes, the strategy can also be applied to other cryptocurrencies, major pairs like Ethereum, meme coins, or even stocks, provided there is sufficient liquidity and fee structure to make the approach viable.

How does the speaker suggest handling tokens that rise after initial investment?

If a token rallies, the speaker suggests selling some of the token at its peak, swapping into USDC to lock in profits, while keeping base currency like Solana to maintain exposure and potentially reinvest in liquidity.

What is the approximate win rate the speaker associates with this method?

The speaker estimates an approximate 80% win rate (8 out of 10 tokens being profitable) when using this one-sided liquidity strategy carefully.

What are the limitations or challenges of this strategy?

Limitations include small individual profits unless using large amounts, potential need to lock funds for several days, the strategy being boring or slow, and the necessity of experience to judge which tokens are worth long-term holding.

Why does the speaker prefer small incremental profits over chasing large gains?

Small incremental profits reduce risk exposure, allow consistent compounding, and ensure that even if the token price falls significantly, the liquidity provider can still achieve net positive results from fees and minor gains.

What does the speaker mean by 'daily runners'?

'Daily runners' refer to tokens that frequently show short-term upward momentum, providing opportunities to earn consistent small profits using this one-sided liquidity strategy.