> For the complete documentation index, see [llms.txt](https://docs.bean.exchange/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.bean.exchange/spot-market/dlmm/the-liquidity-shape.md).

# The Liquidity Shape

In Bean DLMM, liquidity is distributed across discrete price bins, and LPs can choose different **liquidity shapes** to define how their capital is allocated across those bins. Each shape represents a different strategy to manage trade-offs between capital efficiency, fee capture, and price exposure.

Liquidity shapes allow LPs to:

* Concentrate capital around the current market price for maximum efficiency
* Spread liquidity across wider price bands for passive exposure
* Strategically position liquidity to automate buy-low/sell-high logic

Bean currently supports three core liquidity shapes:

* Spot
* Curve
* Bid-Ask

Below is a detailed explanation of how each shape works, followed by a comparison table to help you decide.

## 1. Spot Shape 

The Spot shape distributes liquidity evenly across a defined price range (e.g., ±5% around the current market price). This creates a flat distribution where each bin receives the same amount of liquidity.

This is similar to CLMM ranges in traditional DEXs but divided discretely by bins. Each bin holds a balanced share of the LP's total allocation, allowing the price to drift within the band while still enabling trades.

### **How it works**

* LPs specify a range (e.g., ±5% from current price)
* Liquidity is split equally among bins within this range
* Each bin can support two-way swaps as long as it has reserves

### **Visual Example**

<figure><img src="https://426644680-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FfDNdlTvpFcwV2kJRwNX5%2Fuploads%2FIxeEPvdNV9caoA0sw22V%2Fspot_liquidity_mon_usdc_split_bar.png?alt=media&amp;token=ce5f456c-12f7-49d1-aea2-331db8fe9488" alt=""><figcaption></figcaption></figure>

***

## 2. Curve Shape&#x20;

The Curve shape concentrates most of the liquidity near the center (usually the current price), then gradually decreases it toward the edges. This creates a smooth, bell-curve-like distribution, ideal for price action hovering around a mean value.

This strategy is optimal when trading volume clusters near a central price level and aims to maximize capital efficiency while still allowing modest drift.

### **How it works**

* Most bins near the current price receive a higher allocation
* Outer bins receive less, forming a Gaussian-like curve
* Useful for mean-reverting or sideways markets

### **Visual Example**

<figure><img src="https://426644680-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FfDNdlTvpFcwV2kJRwNX5%2Fuploads%2FJGTI6SxWlW2speXQY8bW%2Fcurve_liquidity_mon_usdc_split_bar.png?alt=media&amp;token=65f20042-84fc-4750-88d4-4f56c75e2c1f" alt=""><figcaption></figcaption></figure>

***

## 3. Bid-Ask Shape&#x20;

The Bid-Ask shape places liquidity at two peaks on either side of the current price, leaving little or no liquidity in the center. This design simulates a traditional order book's bid-ask spread.

The strategy is great for capturing swings in both directions. LPs can accumulate tokens when the price dips and offload when it pumps, passively executing a buy-low/sell-high routine.

### **How it works**

* Liquidity is allocated to two zones: one below and one above current price
* Mid-price bins are left empty or sparsely populated
* Useful for highly volatile or mean-reverting assets

### **Visual Example**

<figure><img src="https://426644680-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FfDNdlTvpFcwV2kJRwNX5%2Fuploads%2Fk5kEePqOiKJPbvaBp8ro%2FBid-Ask.jpg?alt=media&amp;token=eaddff58-c784-41fc-b47d-590760c9792f" alt=""><figcaption></figcaption></figure>

***

## Liquidity Shape Comparison

| Strategy | When to Use                                                | Strengths                                              | Trade-Offs                                             | IL Rish | Upkeep |
| -------- | ---------------------------------------------------------- | ------------------------------------------------------ | ------------------------------------------------------ | ------- | ------ |
| Spot     | Stablecoin pairs, passive LPs, wide price windows          | High uptime, transparent IL, minimal upkeep            | Less capital efficiency, lower APR in volatile markets | Low     | Low    |
| Curve    | Sideways/range-bound pairs, large caps                     | Capital efficient, high fee capture near current price | Requires rebalancing if price trends too far           | Medium  | Medium |
| Bid-Ask  | Volatile or mean-reverting markets, memecoins, passive DCA | Captures fees from large swings, auto buy/sell cycles  | Higher IL risk, inactive at mid-range                  | High    | High   |