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If you have both ETH and a seasonal token in your MetaMask wallet, you can provide liquidity to the Uniswap trading pool. This allows you to collect trading fees whenever the tokens are traded for ETH, as well as use the farm to receive a portion of the tokens produced by mining.
When you have added liquidity to the trading pool, you will have a liquidity position that you can deposit into the farm.
Liquidity positions must have a fee of 1% and cover the full range of prices to be used with the farm.
Tokens received by the farm are distributed to liquidity providers in proportion to the amount of liquidity they provide to a given token/ETH trading pair. If there is only one person providing liquidity for the Spring/ETH trading pair, that person will receive 100% of the incoming tokens allocated to that trading pair.
Providing liquidity can lead to losses when the price moves a lot in a single direction. The ETH and tokens you supply to the trading pool are available for traders to buy. If the price of tokens rises after you provide liquidity, it is because traders are buying them, partly from you, and as a result you will have more ETH and fewer tokens afterwards. Conversely, if the price of tokens falls, you will have more tokens and less ETH, since traders will have sold tokens to you in exchange for ETH.
Read this article to learn how movements in the price affect the profits of liquidity providers.
Although changes in the price will affect the quantities of tokens and ETH you receive when you withdraw your liquidity from Uniswap, the number of tokens you receive from farming will not be affected by changes in the prices of the tokens, because tokens are distributed to farmers in proportion to the liquidity they provide, and the quantity of liquidity in your position does not change when the price changes.