Market Making

Liquidity Rebalances: sweep(), slide(), and bump()

Baseline protocol incorporates three advanced liquidity rebalancing strategies—sweep(), slide(), and bump()—designed to optimize liquidity management based on NOMA token market dynamics.

• sweep: Triggered upon a 2% decrease in NOMA token price.
• slide: Triggered upon a 2% decrease in NOMA token price.
• bump: Triggered upon sufficient accumulation of liquidity surplus.

sweep()

Functionality:

• Liquidity Redistribution: Moves liquidity from lower anchor ranges to the floor, enhancing its capacity to sustain higher market prices.
• Surplus Deployment: Redistributes excess liquidity across anchor ranges, bolstering liquidity depth near actively traded price levels.
• Expansion of Discovery Range: Increases liquidity capacity in the discovery range, enhancing overall market liquidity.

🟩 Floor 🟨 Anchor ⬜ Discovery

    xychart-beta
    title "Distribution"
    x-axis "Price" [0.8, 0.84, 0.88, 0.92, 0.96, 1, 1.04, 1.08, 1.12, 1.16, 1.2, 1.24, 1.28, 1.32, 1.36, 1.4, 1.44, 1.48]
    y-axis "Liquidity Depth" 0.025 --> 0.98
    bar [0]
    bar [1]
    bar [0]
    bar [0,0,0,0,0.25,0.25,0.25,0.25,0.25,0.25,0.25,0.25,0.25]
    bar [0]
    bar [0,0,0,0,0,0,0,0,0,0,0,0,0.35,0.35,0.35,0.35,0.35,0.35]
    bar [0]
    bar [0]
    bar [0]
    bar [0]

During bullish phases, sweep() leverages surplus liquidity to enhance readiness for potential price spikes, optimizing liquidity provision.

slide()

Functionality:

• Liquidity Adjustment: Repositions anchor liquidity closer to the current NOMA price, maximizing absorbable liquidity capacity.
• Depth Reduction in Discovery Range: Lowers liquidity thresholds in the discovery range, facilitating quicker market responses to price declines.

🟩 wETH 🟪 NOMA

    xychart-beta
    title "Distribution"
    x-axis "Price" [0.8, 0.84, 0.88, 0.92, 0.96, 1, 1.04, 1.08, 1.12, 1.16, 1.2, 1.24, 1.28, 1.32, 1.36, 1.4, 1.44, 1.48]
    y-axis "Liquidity Depth" 0.025 --> 0.98
    bar [0]
    bar [1,0,0,0.25,0.25,0.25,0.25,0.25,0.25,0.25,0.25,0.25]
    bar [0]
    bar [0]
    bar [0]
    bar [0]
    bar [0]
    bar [0,0,0,0.225,0.2,0.175,0.15,0.125,0.15,0.175,0.2,0.225,0.35,0.35,0.35,0.35,0.35,0.35]
    bar [0]
    bar [0]
    line [0,0,0,0.225,0.2,0.175,0.15,0.125,0.15,0.175,0.2,0.225]

slide() adjusts liquidity dynamics during bearish trends, aiming to maintain optimal liquidity provision while mitigating potential price volatilities.

bump()

Functionality:

• Price Impact Strategy: Attempts to elevate the NOMA Base Liquidity Value (BLV) by assessing the feasibility of buying back circulating tokens at higher prices.

🟩 Floor 🟨 Anchor ⬜ Discovery

    xychart-beta
    title "Distribution"
    x-axis "Price" [0.8, 0.84, 0.88, 0.92, 0.96, 1, 1.04, 1.08, 1.12, 1.16, 1.2, 1.24, 1.28, 1.32, 1.36, 1.4, 1.44, 1.48]
    y-axis "Liquidity Depth" 0.025 --> 0.98
    bar [0]
    bar [1]
    bar [0]
    bar [0,0,0,0,0.25,0.25,0.25,0.25,0.25,0.25,0.25,0.25,0.25]
    bar [0]
    bar [0,0,0,0,0,0,0,0,0,0,0,0,0.35,0.35,0.35,0.35,0.35,0.35]
    bar [0]
    bar [0]
    bar [0]
    bar [0]

bump() strategically boosts NOMA token prices, potentially enhancing borrowing capacity for token holders and optimizing market positioning.