Out of range liquidity refers to liquidity with a set price range that is outside of a pool’s current price.
Out of range liquidity happens when the current price of a pool moves outside of the positions set price range due to swap activity.
Additionally, liquidity providers can add liquidity out of range. They do this by setting their positions a price range above or below the current price in a pool.
While out of range, providers can add liquidity using only one of the two tokens in the pool.
Important note: Out of range liquidity is single-sided and does not earn fees until the current price of the pool moves into the set range. This is only possible with concentrated liquidity on Uniswap v3 and v4.
Here is an example of a position that is out of range:
Here is an example of out of range liquidity with a price range that is above the current price:
Here is an example of out of range liquidity with a price range that is below the current price:
Liquidity can become out of range if the current price in a pool moves outside the position's set price range due to swap activity.