Trading LP Parameters
When providing liquidity to trading pools, there are multiple parameters that need to be set:
Type (soon to be available):
Type | Holds | |
---|---|---|
Trade | NFTs & Tokens | Can buy and sell and price can increase and decrease |
TradeUp | NFTs & Tokens | Can buy and sell and price can only increase |
TradeDown | NFTs & Tokens | Can buy and sell and price can only decrease |
Buy | Only Tokens | Can only buy (price will only decrease) |
Sell | Only NFTs | Can only sell (price will only increase) |
Price Curve - Controls how the LP's price changes after each trade. There are two options: linear and exponential.
Exponential:
Linear:
Delta - The parameter that controls the behaviour of the price curve. It is represented as a percentage for the exponential curve and a value in ETH for the linear curve. (e.g. 20% for the exponential curve and 0.1 ETH for the linear curve).
Initial Price - The initial price at which the LP will provide liquidity. It is advisable to keep this value close to the market price of the underlying NFTs in order to optimize the utilization of the liquidity.
ETH Amount - The amount of ETH that will be supplied to the LP.
Fee - The percentage fee that the LP will take on each trade it participates in. (e.g. 0.5%).
NFTs - The NFTs that will be supplied to the LP.
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