Capital Efficiency Using Arbitrary Curves On Solana’s ALFPROTOCOL
November 22 2021 - 1:00AM
NEWSBTC
An Innovation Offered By Alfprotocol, Making Full Use Of Bonding
Curves Alfprotocol is a Solana protocol for the capital deployment
of liquidity provision and yield farming, with and without
leverage. The protocol includes implementing an invariant-based
Automated Market Maker protocol and a money market for short-term
loans for exchange activities. The Solana ecosystem’s most
important contributions are leveraging liquidity providers’
positions in AMM pools and yield farming procedures. The protocol
will provide AlfMM and AAlf for its users, a decentralized exchange
service, and an overcollateralized borrowing service, respectively.
On the other hand, leveraged liquidity is managed by one of
Alfprotocol’s modules, which interfaces with external protocols
such as Solaris, Jet Protocol, and others to deliver leveraged
products up to 200x. Arbitrary Curves One of the most recent
breakthroughs in DeFi is the development of DEXs that can
autonomously manage conversions between different crypto assets.
Solana’s decentralized exchange protocols contain a liquidity pool
(LP) comprising two or more assets bound to maintain a mathematical
relationship with each other at all times, as defined by a specific
function or curve. Such functions include constant-sum and
constant-product AMMs. Such actions have the potential to diminish
the liquidity pool. Market price changes, in particular, can result
in reduced liquidity for one or more of the assets, decreasing the
total value of the LP. We introduce the concept of dynamic curves
to construct the AlfMM in a way that would change the mathematical
link between the assets using information from a market price
oracle, guaranteeing that the pool price remains constant and
identical to the market price. The Alfprotocol, using the Solana
blockchain, will implement arbitrary curves utilizing liquidity and
allocating it efficiently. This method allocates more liquidity
towards the current reference price and less towards the price
extremes. Alfprotocol increases capital efficiency and allows more
liquid markets by connecting low-risk, low-effort investors who
provide liquidity to loan protocols with risk-seeking, active
management investors who focus on leveraged liquidity provision and
yield farming positions. Alfprotocol is currently in development.
To find more info about the project and stay updated with the
project’s current progress, please visit the website and check out
the whitepaper.
Solana (COIN:SOLUSD)
Historical Stock Chart
From Apr 2024 to May 2024
Solana (COIN:SOLUSD)
Historical Stock Chart
From May 2023 to May 2024