> For the complete documentation index, see [llms.txt](https://docs.defioptions.org/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.defioptions.org/protocol/roles/liquidity-providers.md). # Liquidity Providers Liquidity providers 💰 participate by providing funds (stablecoins) to the liquidity pool. When they do that they receive pool tokens in return following a “post-money” valuation strategy, i.e., proportionally to their contribution to the total amount of capital allocated in the pool including the expected value of open option positions held by the pool (this allows new liquidity providers to enter the pool at any time without harm to pre-existent providers). Funds are locked in the pool until it reaches its pre-defined liquidation date, whereupon the pool ceases operations and accumulated capital is distributed to liquidity providers proportionally to their participation in the total supply of pool tokens. A single **Defi Options** liquidity pool instance is able to trade a wide range of options of different maturities, strike prices, and even underlying assets, thus reducing the pool's returns overall volatility due to diversification. We believe this feature will appeal to liquidity providers that are seeking exposure to options in a more controlled way. --- # 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, and the optional `goal` query parameter: ``` GET https://docs.defioptions.org/protocol/roles/liquidity-providers.md?ask=&goal= ``` `ask` is the immediate question: it should be specific, self-contained, and written in natural language. `goal` is optional and describes the broader end goal you are ultimately trying to accomplish on behalf of the user. GitBook uses it to tailor the answer towards what is most useful for that goal. 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.