Hello,
Iam currently building a DApp on top of Algorand and Iam almost reaching the Blockchain layer, the next step will be creation of new ASA but Iam not sure that I have understand clearly how that works in fact even after reading Tinyman docs carrefully, so I have a basic couple of questions concerning that :
1- How can I provide liquidity to the users ? I can see that most of DApps use Tinyman, so the logic is to create a new pool there and provide liquidity but after some researches it seems that I should provide liquidity for both assets of the pool, that is if I want to put some millions of this new asset as liquidity initialization(which is the regular case) then I should put also on the other side a big amount of Algos, so should I be rich to do that or what 
? Iam sure that I missed something
2- What is the real value of an ASA ? Can the owner set it ? How does it change across time in Tinyman pool ?
Thank you for everybody in advance.
You can just go to Tinyman “pool” from nav bar on top left corner and then on right hand side you have “Create new pool +”.
But yes, you have to provide both assets in equal ratio value basis at first. Meaning, if you have ASA called TOKEN and you want to create USDC/TOKEN liquidity pool, you have to provide both tokens into that pool in ratio you want your new TOKEN to be valued. for example if you add 1000 USDC & 1000 TOKEN, then 1 USDC = 1 TOKEN, so 1 TOKEN is worth 1 USDC. if you place 100 USDC & 100000 TOKEN, then 1 TOKEN is worth 0,001 USDC → $0,001.
if you have 1.000.000 TOKEN in total and you only provide 1000 TOKEN initial liquidity against 1000 USDC, then those TOKEN are worth 1M in total, but in reality that will not hold if you want to sell any of your tokens. so you can’t really create value out of thin air. If you can, then we would all be millionaires.
so to your second question, eventually market will set your tokens real value when people trade it.
So trading will change the value like in stock market when people buy and sell. in liquidity pool cases, tokens in pool will set the values. for example you put 1000 USDC & 1000 TOKEN, and now you sell bit more into pool and balance after your sells will be 800 USDC & 2300 TOKEN (ratio just from my head for sake of an example), then 1 token will equal 0,238 USDC. so idea is that both sides have equal value.
So people can buy and sell TOKEN using that pool by putting another asset into that pool while taking another ASA out.
Of course you can do ALGO/TOKEN LP too. example was just easier to demonstrate using USDC instead of ALGO because 1 USDC = 1 dollar.
I hope this was clear 
Regards,
ROAM
Thank you very much @ROAM for this detailed explanation, it was very helpful and that answers most of my questions.
So in my case I don’t have much enough funds to offer enough liquidity for starting my project, so if possible to give me some common and well known practices for that, I searched a lot about that, I think I have a couple of choices and Iam not sure if Iam right or no, I will describe it shortly and please excuse my primitive to Algorand :
1- Providing little liquidity in Tinyman and invest the fees to add more liquidity ? Iam not sure about that, I have considered that fees are absolutely independant from the current liquidity and that will not affect the balance in any way, is that true ?
2- Get some funds from investors, I have read that investors may buy some amount of the asset in the early stages, how does this process work please ? is it related to Vestige Vaults ?
3- Using a treasury account that receive the native coin(Algo or USDT) and offer the asset ? But I think this is similar to the LP becasue I have to put again the native coin into the pool to make the correct balance between my asset and the coin.
I will be very thankful for any help and thank you again
to your points
1.) Fees are included into LP when someone trades so not paid out separately. This means that if you want to take fees out, you have to pull liquidity out or part of it. this is red flag in general.
Also if someone buys, and pool balance goes from 1000 USDC / 1000 TOKEN to 1500 USDC / 500 TOKEN (numbers from my head again), you can add one-sided liquidity. meaning you add only TOKEN. for example 1000 TOKEN, so balance will be 1500 USDC / 1500 TOKEN. BUT this is basically dumping because you press price back down. And you will lose investors basically immediately.
2.) I think nothing to do with Vestige vaults. But if you have some investors (I have no idea what kind of project you have), you will probably sell them directly, or is many small community degens want to buy smaller amounts, you can use https://swap.exa.market/ . that works in a way that you select assets you want to swap and amounts. Then you deposit your part and when counterparty deposits, then both will get that amount. so safe way to trade. But I don’t know how we that will work in reality.
3.) Not sure what you mean. sorry. Sounds complicated.
But point is that you can’t create wealth just selling tokens. maybe some small amount yes, but I think that better to build product first. make it successful and then sell tokens if they bring some value. or what is the point of tokens? why someone wants to buy them? some utility?
I don’t want to be rude if I sound like it. just wanted to share things to think.
Regards,
ROAM
Thank you very much again @ROAM, this is exactly what Iam looking for, last thing about LP fees, I know that fees came from others transactions when they trade but why it is red flag to withdraw fees ? since 0.3% will be deducted from the swapper’s own funds it is absolutely independant from the current liquidity, it seems illogic and excuse my stupidity please
fees are in pool and baked into those LP tokens. So say you put in 1000 USDC & 1000 TOKEN and you get 1000 USDC-TOKEN LP tokens. now people trade and pool is worth 1003 USDC & 1002 TOKEN (figures again from head just for sake of an example). now when you pull “fees” out. it means that you give away some of those LP tokens say just 1 USDC-TOKEN LP token. only thing what people see is that you are pulling away liquidity. then you place it again later on and you repeat that over and over again. what this looks to you if you are outsider? → that you are manipulating token price. Then someone asks this on twitter or any other platform and then people will scream “rug” or “scam” etc… This will probably happen.
So in theory it might be right or justified what you do, if you have some strategy, but how that will look outside is the issue. Also when you pull “fees” out, you will also get TOKEN, not just USDC. so this means that when you add liquidity back, you are also adding those pulled TOKEN back into LP. so what is really pull them out at all? Or what kind of strategy you have in mind?
Regards,
ROAM
Okay okay I can understand now, but where those fees go if I didn’t withdraw them ? as my point they became part of the liquidity right ?
they will go into pool and yes, will be part of the liquidity.
Thanks @ROAM, it was a great pleasure to talk with you, Iam new to this community and it seems from the beginning that it is wonderful, there is last thing and please feel free to ignore it if you see that it was long discussion, I just don’t want to create a separate topic for it : I can see many dApps that work for 0% fees, my thinking was that those make money from Tinyman PL fees, if not, how do they make money please ?
happy to help best I can. Regarding 0% fees, what Dapps you are referring to? For example Pera takes small swap fee when you use build in swap, Tinyman gets part of that 0,3% fee when you swap, Defly gets fees when you swap within their wallet, Folks Finance gets part of the accrued interests and small minting fee from gALGO, xBacked collects interest from loans, AlgoMint gets fee when you bridge, MessinaOne gets fee when you bridge and 10% from governance rewards when you participate thru mALGO, Meld has much wider underlying business than just GOLD$ & SILVER$ tokens that are visible to us, Vestige gets fees when you swap and also advertisement income and so on. so do you have some specific dApp in mind? I can try to check how they generate fees if any. and of course I do not have all the answers and I might be wrong, but feels like there is usually some kind of business logic behind.
Regards,
ROAM
Very understood @ROAM, thank you so much for your help, hoping for more great communications like this one in the future, I appreciate your help.