GMX v2 GM pools: being the house for perp traders, and how to book it

How GM and GLV tokens work, why LPs take the other side of traders, where fees go, and the accounting choices for holding GM tokens.

2026-10-17 · 7 min read

Buying a GM token on GMX is not like depositing into a swap pool. Your capital backs leveraged traders, so the token's value moves with trader profits and losses as well as with fees and token prices. For the books, that means one fair-value-driven position whose return you cannot neatly split into interest and principal.

What a GM pool is

A GM (GMX Market) pool has an index price feed, a long token that backs long positions, and a short token that backs short positions [1]. An ETH/USD [WETH-USDC] market, for example, prices positions off ETH/USD, with WETH backing longs and USDC backing shorts [1]. Some pools use the same token on both sides, and some markets are swap-only [1]. Each GM pool is risk-isolated: trader profits and losses in one market do not hit pools in other markets [1].

Pools back two kinds of market. In a fully backed market the index token and long token are the same, so the pool holds the asset it may have to pay out. In a synthetic market they differ, for example DOGE positions backed by an ETH-USDC pool, and in extreme moves trader profits can exceed what the pool can cover [1]. Know which kind you hold; the risk profile is different.

LPs are the counterparty

The GM token price is the pool value plus the net pending profit or loss of open trader positions, divided by GM supply [1]. Pool value includes the deposited tokens and accumulated borrowing fees [1]. When traders lose, the pool gains; when traders win, the pool pays. The pending-PnL term is capped so extreme trader profits cannot fully drain the pool in a single deposit or withdrawal [1].

Fees from trading, swaps, borrowing and liquidations flow straight into the pool and raise the GM price. There is no separate claim step [1]. On Arbitrum and Avalanche, 63 percent of collected fees go to the pool and 37 percent to the protocol [1]. GMX also describes a balanced pool's value, excluding PnL, as behaving like a portfolio that is half long token and half short token, rebalancing as prices move [1].

The fees, and who pays whom

• Position fees of 0.04 or 0.06 percent of position size on opening and closing, depending on whether the trade reduces or increases the long-short imbalance; some markets use different rates [2].
• Swap fees of 0.05 or 0.07 percent on standard markets, with much lower rates on stablecoin markets [2].
• Borrow fees paid only by the side with larger open interest, which accrue to the pool [1][2].
• Funding fees paid by the dominant side to the minority side, so they move between traders rather than to LPs [1][2].
• Price impact on deposits and withdrawals that unbalance a multi-token pool, positive or negative [1].

For an LP, all of this arrives through the token price. You will not see a fee payment in your wallet.

Buying, selling and GLV

Most GMX actions are two-step: you submit a request transaction with an execution fee, and a keeper executes it a few seconds later with signed oracle prices [3]. A GM purchase therefore shows two transactions, and the price you get is set at execution. Withdrawals can be delayed if too much of the pool is reserved for open positions: available liquidity is pool tokens times a reserve factor, less tokens already reserved [1]. GM tokens can also be shifted to another pool with the same backing tokens without buy or sell fees, though price impact still applies [1].

GLV (GMX Liquidity Vault) tokens sit one level up: a GLV holds GM tokens across several markets that share the same long and short tokens and moves liquidity between them based on utilization and caps [1]. Its price follows the same principle, aggregated across its markets [1]. GLV is a fund of GM pools, so it carries all of the above plus allocation decisions made by the GMX risk team.

Accounting choices

First, scope. ASU 2023-08 fair value applies only to fungible crypto assets that give no enforceable rights to underlying assets [4]. A GM token is fungible, but it is a claim on a share of a pool and its PnL, so many entities will conclude it falls outside that scope and needs another measurement basis. The FASB tentatively decided in 2026 to bring wrapped and receipt tokens that entitle the holder to another crypto asset into scope, but KPMG notes that the treatment of liquidity pool tokens remains unclear [5]. As of October 2026 this is unresolved, so document your analysis.

Second, whether buying GM is a disposal of the deposited USDC or WETH. Because the pool takes on trading risk and your return no longer tracks the tokens you put in, many entities treat the purchase as an exchange, with gain or loss on any non-stablecoin deposited. Tax treatment depends on jurisdiction.

Third, presentation of returns. Fee income, trader PnL, price impact and token price moves are all blended into one GM price. Splitting them would require pool-level data most entities do not have, so the common approach is to report a single gain or loss on the GM position and disclose that it includes trading-counterparty exposure.

What to do

• Record each GM or GLV position with its market, long and short tokens, and whether it is fully backed or synthetic.
• Match each request transaction to its keeper execution and use the executed amounts.
• Value GM and GLV holdings at period end from the protocol's own token price, and keep the evidence.
• Settle a written policy on scope, measurement and whether entry is a disposal, and apply it to GM and GLV consistently.
• Disclose that the position bears counterparty risk to leveraged traders, and watch withdrawal liquidity before relying on exit timing.

Sources

1. Providing liquidity (GMX Docs)
2. Fees (GMX Docs)
3. Architecture (GMX Docs)
4. 2.3 Crypto Assets Within the Scope of ASU 2023-08 (Deloitte DART)
5. FASB makes progress on crypto asset transfers project (KPMG)

General information for finance teams, current as of publication. Not legal, tax or accounting advice.

All Newsroom explainers