Liquidity Provider Guide
Moono LPs supply quote liquidity that borrowers use for pump.fun launches. Public LP pools are quote-specific: one pool for WSOL and one pool for USDC.
How LP Earnings Work
Section titled “How LP Earnings Work”LP earnings come from two sources:
- Upfront loan interest — paid by borrowers when a loan opens and distributed to the ticks that funded it.
- Liquidation surplus — when collateral sells above principal, a configured share of the upside accrues to the same funding ticks.
Both streams use the same cumulative-index accounting model. Your position can claim accrued earnings without withdrawing principal.
Step 1: Choose a Quote Pool
Section titled “Step 1: Choose a Quote Pool”WSOL and USDC liquidity do not share accounting. Each quote vault has its own:
- 1,024 tick balances
- LP shares
- borrowed amounts
- interest index
- NAV and underwater state
| Pool | Used by | Main exposure |
|---|---|---|
| WSOL | pump.fun / WSOL launches | SOL-denominated launch demand and collateral liquidation |
| USDC | pump.fun / USDC launches | USDC-denominated launch demand and collateral liquidation |
Pick the pool whose asset exposure you want to hold. You can provide liquidity to both pools, but positions are managed separately.
Step 2: Choose a Tick
Section titled “Step 2: Choose a Tick”Each pool has 1,024 ticks, numbered 0 to 1,023. Loans fill from the lowest available tick upward.
tick_hourly_rate_ppm = min(2048, 2 + tick_index x 2)| Tick range | Rate profile | Trade-off |
|---|---|---|
| 0-50 | Lowest | Used first, lower rate, higher utilization |
| 50-250 | Medium | Balanced utilization and rate |
| 250-500 | High | Higher rate, lower utilization |
| 500-1023 | Maximum | Highest rate, used only when demand reaches high ticks |
Shared interest is distributed proportionally across participating ticks, so low ticks can still earn meaningful yield when utilization is high.
Step 3: Open or Deposit Into a Position
Section titled “Step 3: Open or Deposit Into a Position”- Open the LP page.
- Select WSOL or USDC.
- Select a tick.
- Enter the deposit amount.
- Review the minted-share preview and current NAV.
- Approve the transaction.
Deposits mint LP shares at the current NAV:
shares = deposit_amount x tick_total_shares / (tick_balance + tick_borrowed)If a tick has losses, NAV can be below 1.0. The app shows an underwater confirmation because a new deposit joins that tick at its current impaired NAV.
Step 4: Monitor and Claim
Section titled “Step 4: Monitor and Claim”The pool view shows:
- available and borrowed liquidity
- your share count
- current position value
- tick NAV
- claimable earnings
Claiming transfers accrued interest/surplus to your wallet while keeping the same principal shares.
Step 5: Withdraw or Close
Section titled “Step 5: Withdraw or Close”You can withdraw only the portion of your position that is not currently borrowed:
max_withdrawable_shares = your_shares x tick_balance / (tick_balance + tick_borrowed)If all liquidity in your tick is out on loans, wait for repayments or liquidations before withdrawing.
Closing a position withdraws all currently withdrawable principal and claims remaining earnings. If some liquidity is borrowed, close later after the tick has available balance again.
LP Safety
Section titled “LP Safety”Moono loans are not generic unsecured loans. Public loans are issued specifically for token launches on launchpads such as pump.fun, where the token trades on a bonding curve before it graduates to PumpSwap.
A bonding curve is an on-chain pricing mechanism: buys move the token price up along the curve, sells move it down, and the curve holds the quote liquidity used for redemptions. In practical terms, when a Moono borrower takes a launch loan, the borrowed quote does not leave the protocol as free cash. It is immediately used to buy the launched token, and those purchased base tokens become protocol-controlled collateral for the loan.
This design mitigates LP downside in several ways:
- Collateral is created immediately — the loan is backed by base tokens bought during the launch flow.
- Protocol wallets buy first — the protocol launch buy and protocol-controlled bundle wallets execute before any optional user co-buy.
- User buy is always last — the borrower cannot place their own buy before protocol wallets inside the Moono launch sequence.
- No one can dump into protocol wallets during the sequence — order execution is strict, so outside traders cannot sell into protocol-controlled wallets before those wallets establish their positions.
- Trading-cost buffer — the borrower prefunds refundable quote overhead. The current public configurations use a 2.5% quote overhead component to cover ordinary quote-side trading costs around protocol operations; unused overhead is returned when the loan closes.
- Migration reserve — the loan prefunds a reserve for PumpSwap migration and downside coverage if collateral value falls before close.
For LPs, the important point is that the protocol is designed to avoid the main launch-specific failure mode: lending quote liquidity into a launch and then letting someone else sell into the protocol before collateral is established.
For current on-chain limits and surplus percentages, see Economics.