Concentrated liquidity

EN source master · P11-L03 · 30 minutes estimated · needs_review

Offline formative study. No wallet connection, real funds, private keys, signatures, live trade or personal portfolio inputs. Visuals are specifications; this is neither runtime content nor certification.

Capital assigned outside the current price interval does not provide the same local depth as active positions.

Name the position range

Concentrated-liquidity positions allocate liquidity to selected intervals; when price exits a position's interval it becomes inactive and no longer earns active trading fees [CL]. This lesson uses a discrete active-range accounting fixture, not a v3 swap engine. Each position supplies an abstract L value, never a dollar reserve.

Declare the boundary convention

Our toy convention is lower inclusive, upper exclusive: [a,b). A position contributes L if a≤P<b. Exact boundary treatment, tick crossing and fee accounting in real contracts require version-specific code. The toy avoids claiming that every protocol or UI uses its convention.

Sum only active contributions

With A[90,110)L100, B[100,120)L200 and C[115,130)L300, at 105 the active total is300 from A+B. At118 it is500 from B+C. At125 it is300 from C. A listed total 600 therefore does not mean600 is active at every price.

Keep the liquidity units honest

Abstract L is not token quantity, TVL or immediate output. A finite swap can cross several ranges and change composition. No output can be calculated from these interval labels alone without a chosen protocol's formulas, starting square-root price, ticks and token amounts. An out-of-range position may be one-sided; that is not protection from token-price or contract risk. Fee opportunity is conditional, not guaranteed income.

• Active range: interval contributing liquidity at the stipulated current price.
• L: abstract liquidity parameter, not marked value.
• Boundary convention: inclusion/exclusion rule.
• Local depth: liquidity near a price, distinct from aggregate value.

ILLUSTRATIVE positions A[90,110)L100; B[100,120)L200; C[115,130)L300. Toy intervals lower inclusive/upper exclusive. Evaluate P105,110,118,120,125. No tokens, tick spacing or dollar valuation supplied.

Step-depth range diagram with A/B/C intervals and active totals at each test price; mark half-open endpoints and state abstract L. Do not convert600 into TVL or executable output.

Which stipulated intervals are active and their summed abstract L at supplied prices.

Real tick behavior, finite output, fee revenue, available exit amount or safety.

• OBSERVED: FIX-P11-L03 supplies three interval/L assignments.
• INFERRED: at 118 B+C contribute500L.
• UNKNOWN: token quantities and executable swap path.
• INSUFFICIENT EVIDENCE: total 600L proves uniform exit depth.

• Adding inactive liquidity.
• Reading abstract L as dollars.
• Assuming out-of-range means loss-free.

Compute active positions and totals at 105,110,118,120,125. Explain why the fixture cannot produce a20-unit swap quote and why out-of-range does not establish safety.

Deliver calculations or annotations, claim/source table and limitations. Suggested allocation: study 12 minutes, exercise 8, correction/quiz 10; estimate subject to calibration.

• Name protocol/model and interval convention.
• Use active contributions only.
• Preserve L units.
• Do not equate total with exit output.

Concentrated liquidity requires price-local range accounting. Active L, TVL, finite execution and asset safety are distinct.

• Identify active ranges from a stipulated interval convention.
• Explain why aggregate liquidity does not give local exit depth.

P11-L04 after correction review.

NONE in the authoritative catalog. The supplied offline fixture/package is sufficient; no paid feature or unverified Production capability is required. Lab/certification metadata denotes downstream associations, not access gates or live awards.

• [CL] Uniswap — Concentrated liquidity — Position ranges determine active liquidity and out-of-range fee participation. Checked 2026-10-01; locator turn9view4.