# What are the risks ?

As DogeSwap is a hybrid liquidity pool system between Fungible Tokens and NFTs. The impermanent loss that you usually experience in classic token pools on Raydium and other protocols, is still present.

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DogeSwap will balance the Doges & DAWG in the pool based off a Constant Product AMM Algorithm (slight modified version from Uniswap, mainly to adapt NFT constraints).
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#### Example:

User deposits 5 doges & 50k DAWG - If an other user buy doges from the pool and there now are less doges and more DAWG in the whole pool, it is possible for user's pool to now display 4 doges and 60k DAWG.

The algorythm and the arbitrage are here to rebalance the pool so over time users LP will tend back to the 5 doges initially deposited.

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In any case, even if a user removes its liquidity while being imbalanced, he can still swap the supplement of DAWG withdrawn back to a Doge.
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