How to Create Base Token Liquidity Pool in Uniswap
If you want to create a Liquidity Pool of a Base token in Uniswap this post is for you. We are going to show you how to create a Liquidity Pool in just 5+1 steps.
Uniswap is a decentralized exchange (DEX) that uses EVM (Ethereum Virtual Machine) standards, so you can create a liquidity pool of any ERC20 layer 2 token as a Base. When a token is available in a liquidity pool in a DEX, any user can buy and sell it.
A Base token is an ERC20 Layer 2 asset because it uses the ERC20 standard, but adds advantages such as low transaction costs.
Options when creating a Base Token Liquidity Pool in Uniswap
Here you have 2 options, use Smithii's Create Base Liquidity Pool dApp or go directly to Uniswap, our interface is simpler and is audited, so we recommend it, however we are going to tell you about the 2 options.
1. Create Liquidity Pool Base Token in Uniswap with Smithii
Let's go to the Create Liquidity Pool on Base online tool (https://tools.smithii.io/liquidity-pool/base), make sure you have the Base blockchain selected and connect your preferred wallet.
- Connect your wallet to the dApp Create Liquidity Pool on Base
- Choose the "Base Token" (the one that defines the price, usually $WETH, $USDT, $USDC, etc.)
- Choose the "Quote Token", this is your token ready to go to market.
- Add Liquidity, choose the Base Token and Quote Token amounts to be matched, this defines the initial price of your token.
- Click on "Create Liquidity Pool" and accept the transactions.
Seconds later you will have your Liquidity Pool created, it is launched in Uniswap, you can go there to see it. The cost of creating a Base liquidity pool in Smithii is 0.001 WETH which includes the fees for the creation of the token pair and the liquidity pool.
2. Create Base Liquidity Pool in Uniswap
To start with the creation of our Liquidity Pool we access directly to the Uniswap app and connect our wallet. From there in the main menu we will see the access to "Pools" (Remember to select the Base network in the dropdown on the top right).
In this section, we can manage the liquidity pools we have, and also createa new liquidity pool within Uniswap.
Therefore we click on the "New Position" button to start the process.
2.1 Creating Token Pairs in Uniswap
To create our liquidity pool the first thing to do is to create a token pair. In this case, we first select the token with "value" in dollars. For what we have previously discussed I will select USDT, since it is a stablecoin.
We continue by selecting our token, copythetokenaddress and paste it in the searchbar, then you can select it. It is normal that a warning message appears, since it is the first time that a liquidity pool is created with our token.
2.3. Select the commission of your liquidity pool
Our next step will be to select the fee percentage that each transaction will have through our liquidity pool. To do this, we click on "Edit" Fee Tier.
We will see 4 options to choose from. The most common and recommended according to Uniswap, is 0.3%.
2.4. Setting starting price and price range
As this is the first time we create a liquidity pool with the created token pair, we must set the starting price. That is, the price at which users will be able to trade, thanks to our liquidity pool. In addition, we will set the price range.
Regarding the starting price simply indicate the one you consider optimal, it is recommended to prepare a complete tokenomics to follow a strategy.
If we talk about the price range, it is important to emphasize that our liquidity pool will ONLY be active in the range we set. That is, if the token's price is above or below the range that we indicate, our liquidity pool will remain inactive and will not be acting.
Remember that the starting price has to be within the price range we set.
2.5. Deposit liquidity
Once the price range is set , it is time to deposit the liquidity of the token pair. We can decidehow much toadd. Remember to add enough so that users can trade normally without an excessively low limit.
If you create a token from 0 and do not want to add much liquidity, the most common is to start with a VERY low price, so the liquidity scales with the token's price.
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Conclusion
Now you have all the information you needed to create your liquidity pool, evaluate if it is worth doing it or not and if the answer is yes ... You have no excuse to take your token To The Moon!
Thanks for reading us!
Specialized work experience in the cryptographic space related to produce written content.