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Liquidity Pool is a pool of tokens locked in a smart contract allowing you to trade crypto. Liquidity pools work according to the algorithm which allows you to sell or buy regardless of the price, day time and availability of appropriate buyers or sellers. Traders pay trading fees for swapping crypto assets deposited by liquidity providers. The more crypto assets are placed in a liquidity pool, the better liquidity and trading experience this pool can offer. In return, automated market makers charge a small fee for each trade.