# About Liquidity Pools
Waves.Exchange liquidity pools is an investment product that allows users to receive passive income for investing tokens in the pools that provide liquidity for smoother trading on Waves.Exchange.
Liquidity pools service employs smart contract (opens new window) technology. Tokens invested in the pools are used by automatic trading algorithms to stabilize the prices of the corresponding token pairs on Waves.Exchange. The more liquidity is in the pools, the less the exchange load affects the prices. The service is based on the Waves blockchain that provides high transaction speed and low network fees.
Liquidity Pools APY consists of the following:
vAPY income. Users that invest in liquidity pools become liquidity providers and receives LP token in return. LP tokens slowly grow in price over time.
tAPY income. Liquidity providers can stake their LP tokens to receive regular rewards in WX token.
tAPY income percentage can be increased by staking WX token.
WX stakers become holders of gWX and receive weekly rewards in WX token based on the staked amount and the collected spot trading fees.