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LP NFTs

Liquidity positions on MegaFi are represented as non-fungible tokens (NFTs). Each LP NFT tracks your liquidity, zone boundaries, and accumulated fees in a specific MegaPool.

At a Glance​

  • Each liquidity position is an ERC-721 NFT
  • NFTs track position details, fees, and liquidity amount
  • Fully transferable - sell, trade, or hold like any NFT
  • View in wallet, on OpenSea, or in MegaFi interface
  • Burn NFT when removing all liquidity
  • Multiple NFTs per wallet supported

Why NFTs?​

Traditional AMM LP tokens are fungible - one token is identical to another. This works for full-range positions but fails for concentrated liquidity where each position has unique characteristics:

Position A:

  • Zone: $1900 - $2000
  • Liquidity: 10 ETH + 19,000 USDC
  • Fees: $150 unclaimed

Position B:

  • Zone: $2000 - $2100
  • Liquidity: 10 ETH + 20,000 USDC
  • Fees: $50 unclaimed

These positions are not interchangeable. NFTs solve this by giving each position a unique identifier.

NFT Structure​

Each LP NFT contains:

On-Chain Metadata​

Token ID: Unique identifier for the position.

Pool: Which MegaPool the position is in.

Liquidity: Amount of liquidity units in the position.

Lower Tick: Lower boundary of Liquidity Zone.

Upper Tick: Upper boundary of Liquidity Zone.

Fee Growth: Checkpoint for calculating unclaimed fees.

Computed Values​

The interface calculates from on-chain data:

Current Value: USD worth of position at current price.

Token Amounts: How much of each token the position contains.

Unclaimed Fees: Fees earned since last collection.

Zone Status: Whether position is active or out of range.

APR: Historical return rate.

Viewing Your NFTs​

In MegaFi Interface​

Navigate to "Positions" tab. All your LP NFTs display with:

  • Visual representation of position
  • Current status (active/inactive)
  • Value and fee earnings
  • Quick actions (add, remove, collect)

In Wallet​

LP NFTs appear in your wallet's NFT section:

  • Token ID number
  • Generic placeholder image (custom images coming soon)
  • Contract address

Click for basic details. For full information, use MegaFi interface.

On NFT Marketplaces​

LP NFTs are tradeable on platforms like OpenSea:

  • Listed under MegaFi Position Manager contract
  • Metadata displays position details
  • Buyers can see zone boundaries and fees before purchasing

Transferring NFTs​

Why Transfer?​

Sell Position: Sell profitable position without closing it.

Gift: Transfer position to another wallet you control.

Collateral: Use as collateral in lending protocols (where supported).

Trade: Exchange positions with other LPs.

How to Transfer​

Via MegaFi Interface:

  1. Click position
  2. Select "Transfer"
  3. Enter recipient address
  4. Confirm transaction

Via Wallet:

  1. Find NFT in wallet
  2. Select "Send" or "Transfer"
  3. Enter recipient address
  4. Confirm transaction

Via NFT Marketplace:

  1. List position for sale
  2. Buyer purchases
  3. NFT transfers automatically

Transfer gas cost: ~ $0.003

What Transfers​

When you transfer an LP NFT:

Transfers:

  • All liquidity in the position
  • All unclaimed fees
  • Position metadata (zone boundaries, etc.)

Doesn't Transfer:

  • Token approvals (recipient must approve separately)
  • Historical data (charts, past APR)

The recipient owns the position completely and can manage it as they wish.

Trading LP NFTs​

Marketplace Trading​

List positions on NFT marketplaces:

Attractive Positions:

  • Active (in range)
  • High unclaimed fees
  • Profitable zone selection
  • Popular token pair

Less Attractive:

  • Out of range
  • Low fees
  • Impaired by IL
  • Obscure token pair

Price typically reflects:

  • Current position value
  • Unclaimed fees
  • Expected future earnings
  • Liquidity of underlying tokens

Pricing Positions​

Fair value calculation:

Position Value = Token Amounts Value + Unclaimed Fees + Expected Future Fees

Consider:

  • How long until zone goes inactive
  • Historical fee earnings rate
  • IL exposure
  • Gas costs to manage position

Buyers pay premium for:

  • High-earning positions
  • Optimal zones around current price
  • Stable pairs with consistent fees
  • Large unclaimed fee balances

OTC Trading​

Trade positions directly with other users:

  1. Agree on price
  2. Transfer NFT
  3. Receive payment

No marketplace fees, but requires trust or escrow.

Managing Multiple Positions​

Position Dashboard​

MegaFi interface provides overview of all positions:

Active Positions: In range and earning.

Inactive Positions: Out of range.

Total Value: Combined value across all positions.

Total Unclaimed Fees: Sum of all fee earnings.

Combined APR: Weighted average return.

Bulk Actions​

Manage multiple positions simultaneously:

Collect All Fees: Claim fees from all positions in one transaction.

Close All: Remove liquidity from all positions.

Rebalance All: Adjust zones on multiple positions.

Bulk actions save gas compared to individual transactions.

Organization​

Organize positions:

Filter: By token pair, status, or value.

Sort: By APR, value, fees, or age.

Search: Find specific positions by token or ID.

Tags: Add custom labels (coming soon).

NFT Metadata​

Standard Metadata​

LP NFTs follow ERC-721 metadata standard:

{
  "name": "MegaFi Position #12345",
  "description": "Liquidity position in ETH/USDC 0.3%",
  "image": "ipfs://...",
  "attributes": [
    {
      "trait_type": "Pool",
      "value": "ETH/USDC"
    },
    {
      "trait_type": "Fee Tier",
      "value": "0.3%"
    },
    {
      "trait_type": "Lower Price",
      "value": "1900"
    },
    {
      "trait_type": "Upper Price",
      "value": "2100"
    },
    {
      "trait_type": "Status",
      "value": "Active"
    }
  ]
}

Dynamic Images​

NFT images update based on position status:

Active: Green border, "IN RANGE" indicator.

Inactive: Red border, "OUT OF RANGE" indicator.

High Fees: Special badge for positions with significant unclaimed fees.

Images generate dynamically from on-chain data. No IPFS pinning required.

Burning NFTs​

When NFTs Burn​

LP NFTs burn when you remove 100% of liquidity:

  1. Click "Remove All Liquidity"
  2. Confirm transaction
  3. Tokens and fees sent to wallet
  4. NFT burns automatically

Burned NFTs disappear from wallet and blockchain. Token ID becomes invalid.

Partially Removed Positions​

If you remove < 100% liquidity, NFT remains:

  • Updated to reflect new liquidity amount
  • Still represents partial position
  • Can be managed or transferred

Closing Empty Positions​

If position has zero liquidity but unclaimed fees:

  • Collect fees to burn NFT
  • Or transfer NFT to another wallet (they get the fees)

Advanced Use Cases​

Collateralization​

Use LP NFTs as collateral in lending protocols (where supported):

  1. Deposit LP NFT
  2. Borrow against position value
  3. NFT locks in protocol
  4. Fees continue accumulating
  5. Repay loan and retrieve NFT

Borrowing power typically 40-70% of position value.

Yield Strategies​

Combine multiple positions for complex strategies:

Ladder Strategy:

Position 1: $1800 - $1900
Position 2: $1900 - $2000
Position 3: $2000 - $2100
Position 4: $2100 - $2200

As price moves, different NFTs activate. Smooth fee earnings across price ranges.

Hedge Strategy:

Combine LP NFT with Hedge options:

  • LP NFT: Earn fees
  • Put option: Protect downside

Fees help offset option costs.

Fractionalization​

Split single LP NFT into fungible tokens (requires third-party protocol):

  1. Deposit LP NFT into fractionalization contract
  2. Receive 100+ fungible tokens representing shares
  3. Trade shares separately
  4. Redeem enough shares to reclaim NFT

Enables group ownership or easier trading of valuable positions.

Security Considerations​

Approval Management​

NFTs require separate approvals from tokens:

Token Approvals: Allow adding liquidity.

NFT Approval: Allow transferring position.

Revoke approvals when not actively using MegaFi.

Phishing Protection​

Verify Contract: Only interact with official MegaFi Position Manager contract.

Check Recipient: Double-check address when transferring.

Marketplace Safety: List only on reputable NFT marketplaces.

Signature Requests: MegaFi never asks for signatures that transfer NFTs without your explicit action.

Lost NFT Recovery​

If you lose access to wallet containing LP NFT:

No Recovery: Like any blockchain asset, there's no customer support to recover lost NFTs.

Prevention:

  • Use hardware wallet for large positions
  • Maintain backup of seed phrase
  • Consider multi-sig for very large positions

FAQ​

Can I have multiple LP NFTs?
Yes. Create as many positions as you want. Each generates a new NFT.

Are LP NFTs compatible with all wallets?
Any wallet supporting ERC-721 NFTs. Most modern wallets do.

What if I transfer an NFT by mistake?
Transfers are irreversible. Always double-check recipient address.

Can I trade NFTs on any NFT marketplace?
Yes, though some marketplaces may not display metadata properly. OpenSea and major platforms support LP NFTs.

Do fees still accumulate in transferred NFTs?
Yes. Fees accumulate in the position itself, not tied to original creator.

What happens to NFT if pool is deprecated?
You can still withdraw liquidity. NFT represents claim on pool reserves.

Next Steps​

Understand LP NFT mechanics:

Your positions, your NFTs.