In the fast-paced world of DeFi on Solana, where memecoins can skyrocket or crash overnight, smart liquidity providing can turn volatility into profit. A recent example comes from Twitter user @DeFiDeRekt, who shared a stunning update on their HAM-SOL liquidity pool position using the HawkFi platform. Clocking in at +301.93% overall performance, this multi-day setup demonstrates the power of strategic liquidity management in high-volatility environments.

The trader, who serves as Strat & BD Lead at HawkFi, emphasized trusting the platform's LP Cheatsheet—a guide packed with templates for optimizing yields based on market conditions. For those new to the term, liquidity providing (LPing) involves supplying assets to a trading pool to facilitate swaps, earning fees in return. On Solana, platforms like HawkFi automate this process, making it easier to handle the network's speed and low costs.

The Setup: High-Volatility Memecoin Strategy

Building on an earlier post, @DeFiDeRekt explained they were testing HawkFi's LP Cheatsheet for a Dynamic Liquidity Market Making (DLMM) position on the HAM-SOL pair. HAM is a popular Solana-based memecoin, known for its community-driven hype and rapid price swings, often tied to trends in the broader crypto meme ecosystem.

They classified the pool as:

• Type: Memecoins
• Volatility: High
• Volume: High

Based on the cheatsheet, the entry was set as Bid-Ask (using SOL only), with configurations including High-Frequency Liquidity (HFL) with auto-swap, auto-rebalance every 0 minutes, and auto-compound. HFL refers to a strategy where liquidity is adjusted frequently to capture fees from rapid trades, ideal for volatile assets like memecoins. Auto-swap automates token exchanges within the position, auto-rebalance keeps the liquidity range optimized as prices move, and auto-compound reinvests earned fees back into the pool for compounded growth.

Breaking Down the Performance

The analytics screenshot reveals impressive side-by-side comparisons:

• LP Performance: +301.93%
• HODL Pair: +931.13% (simply holding both tokens)
• HODL HAM: +262.37%
• HODL SOL: +1.83%

This highlights how active LPing outperformed just holding SOL but lagged behind holding the pair or HAM alone—yet still delivered massive gains through fees. The price range was set from 0.04209721 to 0.04279396, with automations handling the rest. In a reply to a question about bins (discrete price ranges in concentrated liquidity models, similar to Uniswap V3), the trader revealed using -17 bins on the buy side and +19 on the sell side, covering roughly -13% to +17% price movement. This wider setup, heavier on sells, aimed to collect heavy fees and effectively dollar-cost average out during volatility.

HawkFi, as an analytics and automation platform, excels here by simplifying these setups for on-chain market makers targeting Solana memecoins. It provides tools to earn yields smarter, with features like stop-loss, ping-pong strategies (oscillating between ranges), and customizable cooldowns to avoid over-trading.

Why This Matters for Memecoin Enthusiasts

Memecoins like HAM thrive on hype, but providing liquidity can be risky due to impermanent loss—where price divergence erodes your position's value. However, with high volume and volatility, fees can more than compensate, as seen here. The LP Cheatsheet recommends wider ranges for such scenarios to buffer against swings, and automations like those used ensure hands-off management.

@DeFiDeRekt is running these plays publicly to educate others, showing both wins and potential pitfalls. For blockchain practitioners dipping into Solana DeFi, this underscores the value of platforms like HawkFi in turning passive holdings into active income streams.

If you're inspired to try, check out the HawkFi LP Cheatsheet for more templates. Just remember, DeFi involves risks—always do your own research and start small.

For the full thread, head over to the original post on X.