Welcome to bulliscoming guide on How to check if Liquidity is lock, decentralized exchange (DEX) like Pancakeswap utilize liquidity pool (LP) to facilitate the trading of a particular asset that’s being listed on the exchange, the liquidity provider or the dev deposit an equal value of two token to create a pair e.g BNB/CAKE within which the depositor receives a share of pools for every trade of the asset that the liquidity is provided for.
The liquidity provider can remove liquidity and claim the shares of pools (liquidity pools token) at anytime
Now in the case of a new token that’s not listed on any centralized exchange (CEX) or other markets, the ability to remove liquidity at any time by the liquidity provider or the dev would be a red flag for the asset investors as they will get stuck and won’t be able to sell the asset back to a valuable asset when liquidity has been been removed by the asset dev by the liquidity provider.
To prevent this crypto market scam as in the case of one acclaimed fake Crypto gurus IFEANYI, investors ought to confirm if liquidity provided for the asset is locked so as to give them more confidence that the asset they are investing in has a minimal case of rug pull.
So without much ado, let’s understand what a locked liquidity lock means and how to check if liquidity is locked on different DEX
What Liquidity Means
Liquidity in terms of cryptocurrency simply means how easily particular crypto can be bought or sold without it affecting the asset price
What is Liquidity Lokcing
Liquidity locking is the process of locking up an LP token by transferring it to a smart contract for a certain period of time within which the developer will be revoked permission to remove the locked fund for a certain period of time
How to check if Liquidity is Lock in Bscscan
To check if liquidity is locked on bscscan, navigate to the token overview you want to analyze. In this guide, am analyzing a BSC token name Sheep Token
Then scroll down, click on holders and then click on the address tagged as the name of the token that’s you’re analyzing as in the image below Pancakeswap: SHEEP2 for SHEEP TOKEN
After you click that, in the page that pop-up, scroll down and click on the address under Filtered by the token holder as in the image below
On the next page, scroll down and click on Pancake Lp under the token tracker
After that, then scroll down on the next page, click on holder and then click the first address
After you’d click the first address under the holder section then click on the address under Filtered by the token holder on the next page
On the next page, scroll down and click on contract then click read as shown in the image below. This show that Sheep token liquidity is locked
How to check duration of locked liquidity
Confirming if liquidity is locked is not enough for investors that’s analyzing a particular asset they want to invest in as the asset dev can lock liquidity for a short period of time like just a 1week duration within which they can remove it after one week and will leave investors that have already confirmed the locked liquidity wondered which would have resulted to loss of asset of an investor as they won’t be able to sell the asset back to liquid cash or any valuable asset
Below is the step-by-step guide on how to confirm the duration of the locked liquidity.
After you’ve checked the liquidity and confirmed that it’s locked as in the previous guide on how to check repeated in the image below then copy the numbers under Release time
Navigate to epochconverter.com/, scroll down a bit and paste the copied numbers in the box then click Timestamp to human date as shown in the image below
It will show you the date a d time that liquidity is locked till, as in the case of our analyzed token (Sheep token) in this guide, it shows that liquidity is locked until 29 July 2021 which mean the liquidity will be unlocked on 29th and the dev can remove liquidity and rug pull if they want to.
The easiest way to make fortune out of cryptocurrency is to be an early investor in a promising cryptocurrency but in the quest of being an early investor, investors ought to do any research about the asset they’re planning to invest in as there were many cryptocurrencies being created on a daily basis without real roadmap and vision but for the dev selfish interest most especially BSC tokens
Investors should find out if the dev has locked their Liquidity and the duration so as to rest assured that the project rug pull case is minimal
However, when analyzing any crypto project, Liquidity lock and the duration should the first priority in fundamental research of the project before any other metrics that can make the asset worth investing.
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