DeFi Guide

How to Add Liquidity on Camelot DEX (Arbitrum)

12 min readUpdated June 2026Liquidity

Camelot DEX is Arbitrum One's native decentralized exchange, built specifically for the Arbitrum ecosystem rather than simply ported from another chain. Unlike Uniswap which supports many chains, Camelot is Arbitrum-first with deep integrations with Arbitrum native protocols. Adding liquidity on Camelot is one of the most effective ways to bootstrap trading for a new token — you provide initial liquidity so traders can swap your token for ETH or USDC, earning fees from every trade. This guide covers everything from creating your first liquidity pool to advanced features like Nitro Pools for enhanced yield farming rewards.

What is Camelot DEX?

Camelot is an Arbitrum-native AMM (Automated Market Maker) that launched in late 2022. It quickly became one of Arbitrum's most popular DEXes, particularly for new token launches. Camelot provides several advantages over generic DEXes when launching on Arbitrum:

Dual fee model: Separate fee tiers for stable pairs and volatile pairs, optimized for each type
Nitro Pools: Enhanced staking pools that allow projects to add extra incentives on top of LP fee rewards
Spooky integrations: Built-in integrations with Arbitrum native protocols for yield routing
Round Table program: Project incubation and marketing support for new launches
V3 concentrated liquidity: Similar to Uniswap V3 with custom price ranges for capital efficiency

You can visit Camelot DEX at app.camelot.exchange. Before adding liquidity, make sure your wallet is configured for Arbitrum One. If you need help with that, see our guide on adding Arbitrum to MetaMask.

Before You Add Liquidity

There are several prerequisites to address before creating a liquidity pool on Camelot:

What You Need

Your deployed token contract address: Created via createarbitrumtoken.com or another method, already deployed on Arbitrum One.
ETH on Arbitrum One: Both for gas fees and as one side of the liquidity pair. You need Arbitrum ETH, not mainnet ETH.
Your token tokens: The tokens you will provide as the other side of the pair. Typically 50-80% of your initial circulating supply.
MetaMask or compatible wallet: Connected to Arbitrum One (Chain ID 42161).
A price decision: Adding liquidity requires you to set a price. Think about your initial token price carefully before proceeding.

Warning — Setting your initial price: The ratio of your token to ETH when you first add liquidity determines the initial price. If you add 1,000,000 tokens and 0.1 ETH (worth ~$350), each token is priced at $0.00035. This price is permanent and cannot be changed after pool creation without removing liquidity. Think carefully about your initial price and the market cap it implies before proceeding.

Adding Liquidity to a V2 Pool (Standard AMM)

Camelot V2 pools use the classic xy=k AMM formula, providing liquidity across all price ranges. This is the simplest option for new token launches.

Go to Camelot Liquidity pageNavigate to app.camelot.exchange and click "Liquidity" in the top navigation menu.
Click "New Position"On the liquidity page, click the blue "New Position" button to start the pool creation process.
Select the pool versionChoose "V2" for the classic AMM. (V3 is the concentrated liquidity option covered in the next section.)
Add your token addressIn the first token selector, search for your token by pasting its contract address. Camelot will load the token name and symbol. Always verify the contract address matches your deployed token by cross-checking with Arbiscan.
Select the paired assetChoose ETH for most new tokens. USDC pairs are also common for more established tokens. ETH pairs tend to attract more organic volume from traders.
Enter your liquidity amountsEnter the amount of ETH you want to provide. Camelot will automatically calculate the equivalent token amount based on your desired price. Alternatively, enter your token amount first. The ratio you enter sets the initial price.
Approve the token contractClick "Approve [YOUR TOKEN]" and confirm the transaction in MetaMask. This grants Camelot permission to move your tokens. Gas cost is minimal on Arbitrum.
Confirm the Add Liquidity transactionReview the final amounts and price. Click "Add Liquidity" and confirm in MetaMask. You will receive LP tokens representing your position.
Save your LP token detailsAfter the transaction confirms, note your LP position. Your LP tokens represent your ownership share of the pool and your right to withdraw liquidity plus accumulated fees.

Need a Token First?

Deploy your ERC-20 on Arbitrum in minutes before adding liquidity on Camelot.

Create Token on Arbitrum

Adding Concentrated Liquidity (V3)

Camelot V3 uses concentrated liquidity, similar to Uniswap V3. You provide liquidity within a specific price range, earning higher fees when the price trades within your range, but earning nothing outside it. This is more capital efficient but requires active management.

Choosing Your Price Range

Full range (like V2): Set minimum price to 0 and maximum to infinity. Behaves like V2 but with V3 mechanics. Safer for new tokens with unpredictable price discovery.
Tight range (+/- 20%): Concentrates capital near current price. Maximum fee income if price stays in range, but position becomes inactive if price moves significantly.
Medium range (+/- 50-100%): Good balance for tokens that might appreciate significantly while still concentrating capital meaningfully.

For new token launches with unknown price trajectory, using full range or a very wide range is typically safer. You can always reposition later by removing and re-adding liquidity.

Using Nitro Pools for Enhanced Rewards

Nitro Pools are one of Camelot DEXs most powerful features — they allow token projects to add incentive rewards on top of the base LP fee income. This is how many Arbitrum token launches incentivize early liquidity providers.

How Nitro Pools Work

Projects deposit a reward budget in their own token (or another token)
Liquidity providers who stake their LP tokens in the Nitro Pool earn the additional rewards
Rewards are distributed per block or per second based on the pool configuration
Projects can set conditions: minimum liquidity duration, minimum amount, whitelist requirements

Creating a Nitro Pool for Your Token

Navigate to the Nitro Pools section of Camelot
Click "Create Nitro Pool" and select the target LP token (your token/ETH pair)
Set reward token and total reward amount
Configure duration, start time, and any requirements
Deposit the reward tokens and activate the pool

Nitro Pools work particularly well for new launches — the promise of high initial yields attracts liquidity providers which in turn attracts traders. Make sure to communicate your Nitro Pool launch through social media and Telegram communities.

Locking Your LP Tokens

One of the most important trust signals you can give your community is locking your initial liquidity. LP locking means you commit that you cannot withdraw the initial liquidity for a specified period, preventing a rug pull. Serious investors will check whether LP is locked before buying your token.

How to Lock LP on Arbitrum

Team Finance: Most popular LP locker. Supports Camelot LP tokens. Lock at team.finance. Cost is around $50-100 in ETH.
Uncx Network: Another reputable LP locker. Supports most Arbitrum DEX LP tokens. Visit uncx.network.
Unicrypt: Well-established locker with Arbiscan integration. Lock period can be permanent or time-based.

When locking, choose a lock duration that signals long-term commitment. Many successful launches lock for 1-3 years. A locked LP address will appear on Arbiscan and can be verified by any potential investor.

Best practice: Lock at least 80% of your initial liquidity and post the lock transaction hash in your Telegram and Twitter. Many crypto investors now check LP lock status before buying any new token — this one step can dramatically increase community confidence.

Managing Your Liquidity Position

After adding liquidity, your work is not done. Active liquidity management improves fee income and token health:

Monitor your position: Check Camelot regularly to see accumulated fees and current position value. Fees accumulate in real-time as trades occur.
Collect fees: On V3 positions, fees do not automatically add to your liquidity — you need to manually collect them from your position page.
Rebalance if needed: If price moves outside your V3 range, consider removing and re-adding with a new range centered on current price.
Watch for impermanent loss: If your token price increases significantly relative to ETH, you will hold less of your token and more ETH (and vice versa). This is impermanent loss — part of being a liquidity provider.
Communicate liquidity changes: If you remove liquidity for legitimate reasons (rebalancing, upgrading to V3), communicate this to your community in advance to avoid panic.

Frequently Asked Questions

Technically there is no strict minimum, but adding too little liquidity makes your token susceptible to extreme price manipulation through small trades. As a practical guideline, adding at least $500-1000 worth of ETH provides enough initial liquidity for small-cap token launches. The more liquidity you add, the lower the price impact per trade and the more confidence it signals to potential buyers.

Camelot V2 uses the classic AMM formula (xy=k), spreading liquidity across all price ranges from 0 to infinity. V3 uses concentrated liquidity where you choose a specific price range to provide liquidity in, earning higher fees per dollar when price is in your range but zero fees outside. V3 is more capital efficient and suitable for tokens with established price ranges, while V2 is simpler and better for new tokens during initial price discovery.

No. Camelot is a permissionless DEX — anyone can create a liquidity pool for any ERC-20 token on Arbitrum without approval from Camelot or any third party. This is a core feature of DeFi. However, being featured on Camelot marketing materials, their website, or in the Round Table program does require Camelot partnership, which involves an application process.

Camelot charges a swap fee (typically 0.3% for V2 volatile pairs) on each trade. Of this, a portion goes to liquidity providers (around 0.25%) and a smaller portion goes to the protocol. On V3 pools, the fee tier is configurable. Fee income depends entirely on trading volume in your pool — high-volume pairs earn substantial fees, while low-volume pairs earn little. Nitro Pool rewards are separate from base fee income.

Yes. Token/USDC pairs are common on Camelot, particularly for stablecoins or tokens where a dollar-denominated price is important. USDC pairs can also attract a different type of trader who prefers not to hold ETH exposure. On Arbitrum, use the native Arbitrum USDC (not bridged USDC.e) at contract 0xaf88d065e77c8cC2239327C5EDb3A432268e5831. You can also add multiple pairs simultaneously (e.g., both TOKEN/ETH and TOKEN/USDC) to attract different trader types.