Introducing OraiDEX AMM v3: Concentrated Liquidity
We are excited to announce the upcoming launch of OraiDEX AMM v3, bringing a host of new features and improvements designed to elevate your decentralized finance experience. With the integration of concentrated liquidity, OraiDEX v3 marks a significant leap forward in the efficiency and profitability of liquidity provision. This upgrade will empower our users with more control over their assets, ensuring that capital is used more effectively and trading is more seamless than ever before. As we continue to innovate, our goal remains to provide the most robust and dynamic DeFi platform in the Interchain ecosystem.
Why Concentrated Liquidity?
Concentrated liquidity on OraiDEX v3 addresses the inefficiencies inherent in constant product (x*y=k) pools, which are prevalent in v2. While v2 pools ensure liquidity at any price level, they suffer from two fundamental issues. First, since users’ liquidity is allocated across all potential prices on the curve, significant portions of liquidity remain unused at the distal ends of the spectrum. Second, v2 pools often result in major slippage. Essentially, liquidity in v2 pools is spread thinly across the entire order book, akin to placing tiny orders at every potential price level. When an order is executed against this pool, it buys into this spread-out liquidity, causing noticeable price impact and inefficiency.
In contrast, v3 pools on OraiDEX allow liquidity providers to concentrate their assets within specific price ranges, leading to more efficient capital utilization. By focusing liquidity where it is most likely to be traded, v3 pools reduce slippage and enhance the profitability for liquidity providers. This method ensures deeper liquidity and tighter spreads for traders, making the trading experience on OraiDEX v3 more robust and dynamic. Concentrated liquidity empowers users to strategically deploy their assets, reflecting their market insights and strategies, ultimately fostering a more competitive and efficient market. OraiDEX v3 stands as a pivotal advancement in the DeFi ecosystem, offering unparalleled opportunities for growth and efficiency.
Key features of the upcoming OraiDEX v3:
Concentrated Liquidity: Users can set custom limits for the liquidity you provided and make your money works harder for you in farming without the headache of trading.
Easier Stablecoin Swaps: With OraiDEX v3, creating stablecoin pairs for swapping has never been easier, providing more opportunities for efficient trading.
Protocol Fees: By default, protocol fees will be enabled, capturing 20% of the fees paid to liquidity providers. These fees will be distributed to ORAIX holders through a staking vault, incentivizing and rewarding our governance community.
OraiDEX AMM v3 is not just an incremental update; it is a transformative change in how liquidity is managed and utilized. By addressing the limitations of traditional constant product pools, we are introducing a system that allows for more strategic asset allocation, reducing wasted liquidity and minimizing slippage. This evolution is part of our commitment to staying at the cutting edge of DeFi technology, offering our community the best tools to maximize their returns and engage with the market more efficiently. Join us as we usher in this new era of decentralized trading and liquidity management, and be part of the OraiDEX revolution.
Stay tuned for more updates as we continue to enhance the OraiDEX platform, ensuring it remains at the forefront of decentralized finance on the Interchain ecosystem. Join us in this exciting journey and be a part of the future of DeFi with OraiDEX v3!
