Impermanent loss is the difference between the value of tokens in a liquidity pool and the value you would have if you had just held them.
When the price of one token in a pool changes relative to the other, the pool rebalances, and providers can end up with a less valuable mix.
The loss is only realized when you withdraw. If prices return to their original ratio, the loss disappears.
The larger the price divergence, the larger the impermanent loss. Volatile pairs can produce significant losses that exceed the fees earned.
Choose stable or less volatile pairs, and consider whether the trading fees and rewards outweigh the potential loss.
Impermanent loss is a real cost of providing liquidity and should be understood before you deposit into any pool.