# Competitive Farming

## <mark style="color:orange;">Please visit</mark> [<mark style="color:orange;">docs.shadow.so</mark>](https://docs.shadow.so/) <mark style="color:orange;">these are depreciated.</mark>&#x20;

## <mark style="color:orange;">Web app is available at</mark> [<mark style="color:orange;">shadow.so</mark>](https://www.shadow.so/)

With concentrated liquidity, there are new dynamics at play when providing liquidity and yield farming. SHADOW incorporates competitive farming into to the x(3,3) model, which promotes the most optimized positions achievable by users.

<mark style="color:orange;">**What is Competitive Farming?**</mark>\
Competitive farming can be simply explained as a method of rewarding liquidity providers in which the most 'competitive' and productive liquidity is rewarded the highest. In concentrated liquidity models, users choose the liquidity ranges they want to provide their liquidity to. This opens the possibility for a user to choose any liquidity range (tick range) between 0 and infinity.&#x20;

<mark style="color:orange;">**What are the benefits?**</mark>\
The more optimized (tighter) a user's range is, the higher rewards they can earn while the exchange price of their liquidity pair is within the range they have selected. This creates an incentive on the part of liquidity providers to strive to "peak perform" and maximize rewards by providing liquidity at optimal ratios and depths. This optimization drives swap aggregator routings to SHADOW liquidity pairs enhancing the performance of the platform and the earnings of xSHADOW voters and liquidity providers. Concentrated liquidity is unparalleled in its ability to drive volume to liquidity pairs, including those that would otherwise not have sufficient liquidity depth to be competitive.\
\
Higher fees are achieved as a result of increased swap volume directed towards SHADOW concentrated liquidity pairs, increasing the earning potential for xSHADOW voters and liquidity providers.&#x20;

Visual Representation of Competitive Farming:\
In the figure below, the current price-tick of the pair is within the red area. This red area is the currently used swap-tick for trades to route through. Liquidity positions that have the highest concentration around this red line will earn the most rewards while it stays there. Whenever a large enough swap happens, this price-tick will move to either direction, changing the rewards distribution factors.


---

# Agent Instructions: Querying This Documentation

If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question.

Perform an HTTP GET request on the current page URL with the `ask` query parameter:

```
GET https://docs.shadowdex.fi/concentrated-liquidity-core/competitive-farming.md?ask=<question>
```

The question should be specific, self-contained, and written in natural language.
The response will contain a direct answer to the question and relevant excerpts and sources from the documentation.

Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.