BTC Price Rise Raises Pool Value but Not Your Ownership Share

I understand the question: when Bitcoin in a pool rises in price, the pool’s total fiat value goes up and so does the fiat value of my LP position.

My percentage share of the pool (the share of LP tokens I hold versus the total supply) does not change by a price move alone — it only changes if I or others add or remove liquidity or if the protocol alters supply. However, AMM rebalancing means the pool will end up holding less BTC and more of the paired asset as BTC gets more expensive, so the composition of my underlying tokens changes even though my percent ownership stays the same.

I should also keep in mind fees earned and potential impermanent loss: the rising BTC price increases my position value but could produce less return vs. simply HODLing BTC, while trading fees can partially offset that effect.