> ## Documentation Index
> Fetch the complete documentation index at: https://docs.kovaswap.finance/llms.txt
> Use this file to discover all available pages before exploring further.

# LP fees and risks

> How liquidity providers earn and what can go wrong.

Each pool has a configured swap fee in basis points. `20 bps` equals `0.20%`. The factory supports a configurable protocol share of collected swap fees; the remainder benefits liquidity providers through reserves.

Liquidity provision can lose value because of:

* impermanent loss as relative token prices move;
* malicious, upgradeable, taxed, rebasing, or non-standard tokens;
* oracle manipulation and low-liquidity price distortion;
* smart-contract defects;
* bridge, RPC, wallet, and chain failures;
* loss of token value or inability to sell.

<Warning>
  Fee income is not guaranteed to offset losses. KovaSwap contracts are not independently audited.
</Warning>