Are you a retail user looking to purchase tokens on the Sui blockchain with the lowest possible cost and slippage?
Are you a professional trader looking for advanced trading features and earning commission fees in the meantime?
Are you a liquidity provider looking to earn passive income while controlling impermanent loss?
Are you a project creator seeking help managing liquidity for your project tokens?
You are in the right place!
MovEX is a concentrated liquidity AMM + order book hybrid liquidity DEX aiming to provide the best trading experience for traders and liquidity provision experiences for liquidity providers and project creators.
Background
AMM
AMM has been one of the most fundamental innovations in the Defi space. It democratized liquidity provision, dominated initially by professional traders and institutions. AMM made it possible for retail users without advanced knowledge about finance to also earn passive income by providing liquidities. However, the most popular constant product AMM is known to suffer from low capital efficiency, leading to a high trading slippage problem. Uniswap V3 proposed concentrated liquidity AMM giving liquidity providers the flexibility to provide liquidities at a custom range and making it possible to provide single-sided liquidity without owning the token pair. Concentrated liquidity significantly improved the capital efficiency of the AMM, reduced trading slippage, and made it possible to develop customized liquidity provision strategies. Concentrated liquidity can also simulate advanced order types such as limit order.
However, concentrated liquidity suffers from two significant problems — fairness problems and poor user experience for advanced order types. First, since the liquidity on AMM is unordered, the miner, or the validators in the case of PoS, can front-run other liquidity providers by injecting a dominant amount of liquidity around the spot price upon detecting a swap transaction from the mempool, therefore eating up most of the commission fees of this transaction. This is unfair for standard liquidity providers. The second problem is the poor user experience for advanced order types. Although concentrated liquidity can be viewed as an “unordered” order book with a fixed tick size, it’s still inconvenient or even infeasible to simulate certain advanced order types that professional traders require. For example, to stimulate limit orders, a trader has to first provide liquidity on a single side at the desired price range, wait for the token price to cross the selected price range, and then withdraw the liquidity. This would require the trader to either manually wait for the cross to occur and withdraw the liquidity or write a program to do it, causing a lot of hustle and defeating the purpose of a limit order. Another required order type, stop-loss order, cannot be simulated with concentrated liquidity.
Orderbook
Orderbook is the perfect rescue to the above two problems — fairness problem and poor user experience for advanced order types. Orders on order books, by nature, are filled in a first-come-first-serve manner, leaving little to no room for miners or validators to front-run a regular liquidity provider. Orderbook also naturally supports advanced order types like limit orders, stop-loss orders, take-profit orders, and many more. However, the order book is not friendly to retail liquidity providers as it requires programmatically submitting and canceling orders constantly, which was the fundamental reason AMM was invented in the first place.
Key Features
AMM + Order Book Hybrid Liquidity DEX
MovEX combines the best of AMM and order book and delivers the ultimate trading and liquidity provision experience for everyone by creating a hybrid liquidity pool. Internally, MovEX has a settlement engine that distributes orders between AMM and order book, guaranteeing both minimal slippages for traders and fairness for liquidity providers.
Retail liquidity providers enjoy the convenience of providing single-sided liquidity at a custom price range and efficiently manage the impermanent loss.
Professional traders and liquidity providers enjoy the advanced features provided by the order book. Moreover, traders can also earn commissions if their limit order is filled. This is because limit orders are considered makers and, therefore, can receive commissions like liquidity providers, similar to centralized exchanges.
Intelligent Liquidity Management Service
MovEX is more than a DEX. We also provide surrounding services to related stakeholders. A project creator is constantly bothered by efficiently providing liquidity for their project tokens. It’s often unclear to project creators at what price range they should provide liquidity or how they should allocate liquidity at different price ranges. They usually don’t have the infrastructure or tools to rebalance their liquidity when their token price fluctuates. All of the above lead to poor capital utilization, suboptimal market making, volatility, and even the collapse of token prices.
MovEX is here to help. MovEX’s intelligent liquidity management service aims to help project creators to avoid the hustle of manually adjusting liquidity and boost their capital efficiency and market-making returns. Our liquidity management engine runs an optimizer internally, produces the mathematically proven optimal liquidity management under a particular utility function, and automatically adjusts the liquidity for users in a decentralized and non-custodial fashion.
Conclusion
We hope you enjoyed our introduction to MovEX. We’ll dive deeper into some of the details in upcoming posts. In forthcoming posts, we’ll also release educational material related to Move, Sui, and market making.
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