> ## Documentation Index
> Fetch the complete documentation index at: https://docs.solhedge.xyz/llms.txt
> Use this file to discover all available pages before exploring further.

# The Problem We Solve

> Why passive LPing and manual hedging both fall short.

Liquidity provision on decentralized exchanges carries structural risks that keep most capital on the sidelines.

<AccordionGroup>
  <Accordion title="Impermanent Loss (IL)">
    Price divergence between paired assets reduces LP value relative to simply holding. This is the single biggest reason people avoid LPing.
  </Accordion>

  <Accordion title="Range inefficiency">
    Static ranges in concentrated liquidity pools require constant active management, or capital sits idle earning nothing.
  </Accordion>

  <Accordion title="Execution complexity">
    Combining LP positions with perpetual hedges requires multi-protocol coordination and constant monitoring, which most people don't have the time or expertise for.
  </Accordion>

  <Accordion title="Compounding friction">
    Manually reinvesting earned fees introduces delay and gas cost drag, quietly reducing long-term returns.
  </Accordion>
</AccordionGroup>

These factors make DeFi yield generation impractical for anyone who can't dedicate full-time operational bandwidth to position management, which is most people.

## The Choice People Are Forced Into

Without a tool like SolHedge, capital deployers are stuck choosing between:

* **Safety**: hold cash, earn nothing
* **Yield**: accept IL risk, hope volatility doesn't hurt too much

SolHedge gives a third option: **earn fees and protect your capital, automatically.**