Aggregated Positions: Harnessing Multiple Pools, One Trade at a Time

Tackling Liquidity Fragmentation: MUX’s Mission

In 2022, MUX emerged with a clear goal: to raise the bar for decentralized perpetual trading. MUX aims to make it so affordable, straightforward, and user-friendly that Decentralized Perpetual Platforms would become the go-to for leveraged crypto trading.

However, Liquidity Fragmentation in Web 3 posed a significant challenge. With the same asset scattered across multiple pools and chains, liquidity often lacked depth when sourced from just one place. This fragmentation led to:

• Varying prices for the same asset across different pools and chains.
• Time-consuming and costly processes to bridge crypto assets between chains.
• Oracle vulnerability in low liquidity markets, allowing for potential exploitation by larger entities.
• Unpredictable trading experiences due to inconsistent liquidity depths.

These challenges affected the entire on-chain trading community, and MUX was crafted to address them head-on.

Enter the Aggregated Positions Feature, our comprehensive solution. Rolled out over four months, this feature introduced:

• Aggregated Open
• Aggregated Close
• Aggregated Display

We’ll walk you through how each element works symbiotically with the others. By the end, you’ll grasp the immense convenience, trading control and cost-saving potential they offer.

Eager to explore further? Let’s dive in!

Aggregated Open

Historically, each open position on MUX exclusively routed liquidity from either GMX, Gains Network, or the MUXLP. While this setup allowed traders to access the most cost-effective trades from each platform, it also left room for improvement.

Consider this scenario:

Previously, a $10M position opened through the MUX Aggregator would be routed through either GMX or Gains Network, even if $8M in available open interest (OI) existed in the MUXLP.

But what if this trader could have routed 80% of their trade liquidity from a more cost-efficient source?

This limitation led to underutilized OI in the MUXLP, where trading costs are typically lowest, resulting in higher net trading costs for users.

To address this inefficiency, MUX introduced the Aggregated Open Feature in June 2023. This feature allows for the simultaneous routing of trade liquidity from MUXLP, GMX, and Gains Network within a single trade position. It was the first in a series of three updates that make up the Aggregated Positions feature.

Upon its launch, the Aggregated Open Feature achieved the following:

• Boosted Liquidity Utilization in the MUXLP from an average of 20% to 40%
• Increased fees for MUXLP Liquidity Providers due to higher utilization
• Further Reduced Trading Costs for MUX users

Essentially, the Aggregated Open already provided most of the cost-saving advantages of the full Aggregated Positions Feature. Subsequent updates like Aggregated Close and Aggregated Display were rolled out to further refine the user experience.

Currently, the Aggregated Positions Feature is turned off by default in the Trading Settings Menu.

The following two images contrast the Trading Costs with the Aggregated Positions turned on, vs turned off.

With the activation of the Aggregated Position Feature, the average spread for this trade dropped from 0.04% to 0.01%, saving an additional $2,665.7 in Open Fees.

“Trading Costs” are calculated using a variety of factors like price, spread, slippage, price impact, position fees and other potential explicit trading costs in addition to other implicit costs like max leverage, maintenance margin, liquidation fees, available liquidity, etc.

This intricate web of factors is exactly why trading positions that draw from multiple liquidity sources tend to be more cost-efficient. This is particularly true when trying to optimize across diverse Funding Fee and Price Impact Fee models from different protocols. As a result of this, the Aggregated Open Feature significantly enhanced MUX’s Aggregation capabilities, although a minor convenience issue still needed to be accounted for.

MUX traders still had to close their single, Aggregated Position as multiple positions.

Previously, this meant that all Aggregated Positions required one open and two closes, but you’ll be glad to hear that this has all been patched by now.DD

Aggregated Display

What’s better than saving on trading costs?

The ability to manage multiple positions as a single, Aggregated Position!

The Aggregated Display Feature serves this purpose. It offers a panoramic overview of all the “routed positions” housed within your singular Aggregated Position.

Naturally, the Aggregated Display Feature can also be minimized for those times when you’d like to maximally focus on your trades.

Aggregated Close

The Aggregated Close completes the Aggregated Positions, granting you total control over the Profit Taking aspect of your Aggregated Position Trades.

MUX traders can now:

1. Close their entire Aggregregated Position at once. (1 Open, 1 Close)
2. Opt for partial closures by choosing from the routed pools. (1 Open, Multiple Closes)

This works for Market Orders, Limit Orders and Stop Loss Orders.

Below are images that showcase both options side by side:

The Aggregated Close also displays the exact composition of their collateral and profit upon closing their position.

To sum up, the totality of MUX’s aggregation capabilities can now be expressed within a single trade position. The Aggregated Position Feature seamlessly combines these three components:

• The Aggregated Open utilizes liquidity from GMX v1, GMX v2, Gains Network and the MUXLP from within a single position to further reduce trading costs.
• The Aggregated Display gives traders insight into all of the individual components that comprise their Aggregated Position to allow them to make better trading decisions.
• Using this information, traders can now opt to either fully or partially close their Aggregated Position(s) through the Aggregated Close.

Ready to get your trades aggregated?

The aggregated display feature on the position list can’t tell users how much they saved.

Maybe can change this to things surrounding “aggregated position info based on all individual components within the aggregate positions” “manage multiple positions as one aggregated position”