# FAQ: Liquidity with P00LS

If you had previously requested a liquidity pool set up through P00LS, below you'll find an FAQ about how we set up pools for your token. 

P00LS no longer offers liquidity pool creation through the Creator Portal, however we recommend utilizing the [tools provided on Uniswap](https://support.uniswap.org/hc/en-us/articles/20904040289037-How-to-provide-liquidity-on-the-Polygon-Network)!

### FAQ: Creating a Liquidity Pool with P00LS

**Where does P00LS create liquidity pools?**

* P00LS creates liquidity pools using Uniswap and manages the liquidity dynamically based on market prices using Arrakis

**Who provides liquidity for the pool?**

* P00LS uses the supply allocated to us via the zerozero Treasury to start creators initial liquidity pool on Uniswap v3
* In other words, this comes from the 10% of supply that P00LS holds of creator tokens. This does mean liquidity is owned by the zerozero DAO. More info on the [00 DAO Creator Token Proposal. ](https://snapshot.org/#/zerozero.eth/proposal/0x3241c69cd9d6dc9a093e5973e5cbd3227e915423c8b8807e3f6b3f84e7f68ab6)
* P00LS does NOT supply base token supply. If a token creates a pool paired with WETH, P00LS only supplies the Creator token liquidity, we do not add WETH to the pool. 
* Creators do not need to add any of their own supply of tokens to create liquidity, but they absolutely can.

**Can a creator remove liquidity from the pool?**

* Only if they add their own liquidity to the pool. They cannot remove liquidity that P00LS provides.

**Which currency do you recommend we pair with?**

* Generally, the standard paired token for starting a liquidity pool is Wrapped Ethereum (WETH). This is also the recommended paired token. Ex: CREA/WETH
* However, there are many reasons a creator might decide to go with MATIC, BONSAI, or USDC, depending on where their community is most active or if you've received a Grant. It's absolutely fine to select a different currency.

**Is it possible to have multiple liquidity pools?**

* P00LS will only commit liquidity to a single liquidity pool: a single trading pair.
* This does not prevent creators from creating multiple liquidity pools on their own or with their community.
* P00LS recommends minimal open liquidity pools, as Uniswap automatically routes trades from other currencies.
* For instance, if your CREA token is paired with WETH, CREA/WETH, and someone wants to buy your token with MATIC, Uniswap will automatically route them behind the scenes between two pools: MATIC/WETH and then CREA/WETH. Because of this, it is much more productive to have a single, healthy liquidity pool as other currencies can be routed as such.

**What is the starting price of the token when creators launch a pool with P00LS?**

* The Default starting price for your token is 0.0001$. We can start it lower, but not higher. We do not start at a higher starting point because: 
  * Higher starting prices increases the possibility of a rug pull from early community members and large token holders. 
  * By starting at a very low price, it's easier to manage your communities expectations
* We do not add any of the base asset when creating the pool (ETH, MATIC, etc).

**In the case of a creator’s token performing poorly, is there any risk of losing liquidity after a certain period of time?**

* The liquidity provided by P00LS (initially 10% of the total supply of the token and 0 base currency) will stay inside the Uniswap pool whatever the market conditions. 
* The ratio of token to base currency will change, as well as the dollar valuation of the assets in liquidity based on token performance.

**Are there any specific tax implications related to setting up a liquidity pool that creators should be aware of?**

* Selling tokens is a taxable event. Because creators receive tokens for free they should pay taxes on the profit they make by selling their tokens. Not tax advice.