Research & Technology

Liquidity is at first an informational phenomenon. Arbitrageurs bring information to Uniswap through arbitrageur trading - an informed flow. For their service, arbitrageurs receive arbitrage profits. Since Uniswap LPs already pay for this information once (through "impermanent loss"), we want to avoid paying for it again. We achieve this by pulling the required information from the Uniswap Oracle and then adding a trade delay on top. By capturing this information for free, we eliminate impermanent loss.

Having captured the required information, we then proceed to build efficient liquidity that can rival world aggregate levels. The paradigm we invented is called the OB-AMM. It serves as a technical foundation to map order book shape onto AMMs curves. Our debut product is only the tip of the iceberg because our hands are tied by high gas costs. But as we move onto L2, we can unleash the full implications of this paradigm to dynamically map world off-chain liquidity on-chain. You can check out our technical work here

If you want to understand the "whys", reading the following papers is the quickest ways to get there.