âī¸Liquidity pools
Liquidity Pools - LayerFlow
Last updated
Liquidity Pools - LayerFlow
Last updated
Important note: Please keep in mind that our platform is presently only available on content and technical specifications of this chapter may change.
Our liquidity pools are designed to provide significant incentives for liquidity suppliers to contribute cash. Liquidity providers can receive up to 80% of the fees produced by any pool using our pools, regardless of the type of pool they pick. These benefits are delivered promptly to liquidity providers, allowing them to see the fruits of their labour right away.
Our pools contain the following qualities to revolutionize pool characteristics inside the Binance Smart Chain ecosystem:
When a liquidity pool is built, the token balances can be selected in a flexible manner that does not adhere to the standard 50/50 ratio. Instead, our pools use a weighting of, say, 95/5.
Furthermore, the pool creator can dynamically alter the swap charge of each pool based on the pool's overall liquidity and trading volume. This means that creators might raise fees at the debut of a new pool to entice more liquidity providers while liquidity and trade volume are low. Fees can be gradually decreased as trade volume grows and the pool becomes more established. The costs can range from 0.10% to 2.00% for each swap, providing a variety of alternatives for projects looking to kickstart liquidity.
Our pools accept different assets and users or our protocol can deposit or withdraw individual assets. This enables single-sided liquidity mining, in which a user contributes just one asset to a pool of several assets. For example, if a pool holds 80% $BNB and 20% $WBNB measured in USD, a user can only contribute $WBNB tokens to that pool. The user will earn more incentives for staking $WBNB than for staking $BNB since there is less $WBNB staked and thus a larger share of the liquidity provider charge is given to $WBNB stakers. This liquidity pool architecture decreases the user's risk of temporary loss and contributes to more stable liquidity pool weightings as a consequence of economic incentives, resulting in greater fees.
Weighted pools and stable pools are available on our platform. Weighted pools are appropriate for volatile assets like $USDT, $WBNB, or $BUSD, whereas stable pools are created for stable assets like $BUSD/$USDT or $BNB/$WBNB to give a dependable and predictable trading experience.
They allow up to 5 assets per pool
Users can add only one asset to a pool
Balanced or unbalanced LP token withdrawals are possible from a pool
They allow flexible asset weightings of e.g. 90/10%
The swap fees are between 0.1% and 2.0%
The swap fees are adjustable over time by the pool initiator
Our smart liquidity routing solution is built on top of our ability to provide single-sided liquidity. We may establish yield optimisation pools (SLR Pools) using widely used assets like as $BNB, $WBNB, $BUSD, $USDT, and more, where users can stake their assets, using single-sided liquidity. The staked assets are then dispersed to liquidity pools where they are most needed to offer single-sided liquidity and generate the greatest fees. These fees are then divided among the staking pools and individual stakers. This functionality allows users to easily connect with liquidity pools since our protocol automates pool selection and assures the greatest and most efficient APYs while lowering risks. Users can deposit a single asset to give liquidity to many pools while diversifying risk and optimizing yield.
Users deposit $USDT or $BNB to one of our smart liquidity routing pools, the pools collect the liquidity.
The smart liquidity routing pools send the liquidity to multiple pools within the LayerFlow Dapp.
The generated $USDT or $BNB fees are sent back to the smart liquidity routing pools and distributed to all stakers.
The protocol automatically rebalances the smart liquidity routing liquidity based on all pool parameters such as trade volume, existing liquidity, and asset balances.
Example 1: The $USDT smart liquidity routing pool contributes liquidity to pool a due to its low $USDT balance and higher APY potential, while withdrawing liquidity from pool b due to its high $USDT level.
Example 2: The $BNB smart liquidity routing pool contributes liquidity to pool b due to its low $BNB balance and higher APY potential, while withdrawing liquidity from pool c because of its high $BNB level.
Our token holders will manage our whole smart liquidity routing program. It is critical that some decisions inside that program are made by humans. It includes the following decisions:
Creation and termination of smart liquidity routing pools, e.g. $USDT or $BNB
Inclusion and exclusion of normal liquidity pools into the smart liquidity program, e.g. $WBNB/$USDT
By using governance functions to control the smart liquidity routing program, we avoid the influence of our team on important decisions that directly impact the economic chances and risks of our protocol. On top of that, we want to prevent bad actors from draining out liquidity from our smart liquidity routing pools by creating faulty pools with tokens with no value, e.g. 99/1 $SCAM/$USDT.
Arbitrage chances inside DeFi ecosystems result in an average annualised TVL loss of 27.8%, according to our study and estimations. External arbitrage bots will be excluded by our protocol's own arbitrage approach, generating more income. The increased income collected will be allocated to our liquidity providers. As a result, we anticipate offering an extra APY of 20% on average. This function also lowers slippage and pricing implications, ensuring that our traders always receive the best prices available.
