What LP tokens actually are.
When you add liquidity to a decentralised exchange, you don't hand tokens over and receive nothing back. You get LP tokens — a receipt representing your share of that pool. Understanding what they are makes almost everything else about liquidity locking obvious.
How this works on Robinhood Chain. Liquidity here lives in Uniswap v3 and v4 positions, which are NFTs rather than the ERC-20 "LP tokens" older chains use. HoodLock locks ERC-20 tokens, so it cannot hold one of those positions today — token locks, burns and vesting all work as described, but locking liquidity itself is not something we can do on this chain yet. The general explanation below still applies to how liquidity locking works elsewhere.
The mechanics
A liquidity pool holds two assets, typically a project token and ETH. When you deposit both sides, the pool mints LP tokens to you representing your proportional claim. Deposit 10% of the pool's value and you hold 10% of the LP token supply.
To get your liquidity back, you return the LP tokens and the pool burns them, sending you your share of both assets. That's the entire relationship: LP tokens are the key to withdrawing the pool.
Why this makes locking obvious
Whoever holds the LP tokens can withdraw the liquidity. If a team keeps them in a wallet, nothing stops them from returning them and taking the pool, which is what a rug pull is, mechanically. Locking LP tokens in a time-locked contract means the key is unavailable until a date, so the liquidity stays where buyers can trade against it.
This is also why locking the project token instead is a different, much weaker commitment. Locked project tokens can't be sold; locked LP tokens can't be withdrawn. Only the second protects the pool.
Your share isn't fixed in tokens
A detail that surprises people: your LP tokens represent a percentage of the pool, not a fixed number of tokens. As trades happen the pool's composition shifts, so the amounts you get back on withdrawal differ from what you put in — more of whichever asset fell in relative price, less of the one that rose. That's impermanent loss, and it's a property of the pool rather than of anything the locker does.
Finding your LP token
- The LP token is its own contract with its own address, distinct from the project token.
- After adding liquidity, it appears in your wallet's token list, often unnamed or shown with the DEX's naming convention for the pair.
- On Blockscout, the pair address is the LP token address, and its holder list shows who can withdraw the pool.
When locking on HoodLock, you select the LP token from the tokens your wallet holds, so you're picking rather than pasting an address, which removes the most common way this goes wrong.
What to check on someone else's LP
The LP token's holder list is the single most informative page about whether a project's liquidity is safe. A locker contract at the top means locked; a null address means burned; a plain wallet means neither. The full check is here.
Common questions
What is an LP token?
An LP token is a receipt representing your proportional share of a liquidity pool. Returning it to the pool burns it and releases your share of both assets, which means whoever holds the LP tokens can withdraw the liquidity.
Why lock LP tokens instead of the project token?
Because LP tokens are the key to withdrawing the pool. Locking project tokens prevents them being sold; only locking LP tokens prevents the liquidity itself from being removed.
Do LP tokens represent a fixed amount?
No. They represent a percentage of the pool, and the pool's composition changes as trades happen. The amounts you receive on withdrawal will differ from what you deposited — this is impermanent loss, a property of the pool rather than of locking.
How do I find my LP token address?
It is the pair's contract address on the DEX, distinct from the project token address. It also appears in your wallet's token list after you add liquidity, and its holder list on Blockscout shows who can withdraw the pool.
Keep reading
- How to check if liquidity is locked
- Burning vs locking liquidity
- How to lock liquidity on Robinhood Chain
- Locking LP tokens from a Hood Launcher Classic launch
- Liquidity locker
Lock tokens with public proof
Pick a token from your wallet, choose a date, share the proof link. LP positions on this chain are NFTs and aren't supported yet.
Lock tokens →