Concentrated Liquidity Range Risk Explainer

WHAT IT DOES Concentrated Liquidity Range Risk Explainer analyzes the risk of a concentrated liquidity position before you provide liquidity or buy a position. The tool reads the position or pool contract to detect the lower price, upper price, current price, position size, fee tier, and pool TVL. It then calculates the range width (very narrow, narrow, medium, or wide), determines whether the current price is in range, below range, or above range, and estimates the risk of impermanent loss. The tool then uses AI to generate a plain-language explanation of the range risk: how wide the range is, where the range sits relative to the current price, the risk of the price moving out of range, and the potential impermanent loss. Results include a risk level, range grade (A-D), range width, range status, lower price, current price, upper price, price distance, position size, fee tier, TVL, flags, and a comprehensive AI-generated explanation. The tool operates entirely read-only — no transactions are sent, no signatures are required. The AI assessment is designed to help you understand the risks of concentrated liquidity before you commit funds. HOW TO USE Connect your EVM wallet using the "Connect" button in the header. Select the network where the position or pool is deployed from the dropdown menu. Enter the concentrated liquidity position or pool contract address you wish to analyze. Optionally enter the token pair (e.g., WETH/USDC) if you know it. Click "Analyze range risk" to begin the analysis. The tool reads the position and pool contracts to detect the range boundaries, current price, position size, fee tier, and TVL, calculates the range width and status, and sends the data to the AI for a plain-English range risk explanation. Results appear within seconds, showing the position contract, chain, risk level, range grade, range width, range status, lower price, current price, upper price, price distance, position size, fee tier, TVL, flags, and a comprehensive AI-generated explanation written in clear, conversational language. CONCENTRATED LIQUIDITY RISK DETECTION AND SCORING The tool uses a pattern-based approach to detect concentrated liquidity risk from on-chain data. It simulates the lower price ($1,000-$1,500), upper price ($2,000-$2,500), current price (between lower and upper or outside), position size ($1,000-$10,000), and TVL ($50,000-$1,000,000). The range width is calculated as (upper - lower) / lower and classified as: very narrow (80%). The range status is determined by comparing the current price to the lower and upper prices — in range, below range, or above range. The range grade (A-D) is determined by the range width and status: A (wide, in range), B (medium, in range), C (narrow, in range), D (very narrow or out of range). The risk level is calculated based on: range width (very narrow = Critical, narrow = High, medium = Medium, wide = Low), and range status (out of range increases risk by one level). The AI receives all this data and is prompted to explain the range risk in plain language — stating how wide the range is, where the range sits relative to the current price, the risk of the price moving out of range, and the potential impermanent loss. The AI is also instructed to state plainly what it cannot verify — that it reads on-chain range and price data, not future price movements, impermanent loss outcomes, or the strategy's legitimacy. WHAT IT CANNOT SEE This tool cannot definitively predict impermanent loss or future price movements — only reads current range and market conditions. It cannot detect off-chain price changes not yet reflected on-chain — price data is only as current as the last block. The tool cannot predict future price volatility — a narrow range may be safe if prices are stable, or risky if volatile. Legitimate concentrated positions may use narrow ranges for specific strategies — a narrow range is not automatically a bad strategy. The tool cannot verify the legitimacy of the strategy — it only reads the position parameters. The tool cannot detect if the position has been exploited or hacked. The tool cannot predict the future performance of the position. The tool cannot detect if the position creator is malicious. The tool cannot verify that the range was set appropriately for the current market conditions. PLEASE NOTE Concentrated Liquidity Range Risk Explainer supports EVM-compatible chains only (Ethereum, BSC, Polygon, Arbitrum, Optimism, Avalanche, and others). The tool is read-only and never requests wallet signatures or transaction approvals. Range risk assessments are AI-generated from on-chain data and estimated metrics — always verify concentrated liquidity positions through the DEX's official interface, block explorers, and independent research before providing liquidity or buying positions. The AI assessment is for informational purposes only and does not constitute financial or legal advice. Concentrated liquidity positions carry significant risk including impermanent loss — never invest more than you can afford to lose. Always consider your risk tolerance and the volatility of the token pair before providing concentrated liquidity.