# Liquidity

PonytaSwap allows users to effortlessly trade tokens without the need for a centralized exchange. However, users cannot perform token swaps unless there is sufficient liquidity in the pool.

The lack of liquidity in the pool can result in difficulties, high costs, or even failure in executing a token swap. To ensure a seamless token trading experience, PonytaSwap provides users with the opportunity to contribute liquidity to the pools.

By doing so, users not only help to increase the overall liquidity in the pool, but they are also rewarded for their efforts. When a user provides liquidity to a pool, they receive Liquidity Provider (LP) Tokens plus a portion of trading fees as rewards.
