SEGA Protocol
SEGA: A Unique AMM Platform
Unlike other AMM platforms, SEGA provides on-chain liquidity to a central limit order book. This means that SEGA’s users and liquidity pools have access to the order flow and liquidity of the OpenBook ecosystem, and vice versa. This capability is powered by Solana, an incredibly fast and efficient blockchain.
Liquidity Model: Constant Function K = Y * X
SEGA currently employs the constant function K = Y * X, which has the unique property of being stateless. This means that given any two tokens, without requiring information about their relative prices or values, SEGA can provide “infinite” liquidity to traders.
SEGA enhances this model by pricing orders on the order book using the Fibonacci sequence. This allows SEGA to offer up to 20 orders at various price points with spreads as small as 20bps between them. This approach is specifically optimized to fit the exchange instructions into a single SONIC transaction. In the future, additional liquidity provisioning models are expected to leverage oracles and increase liquidity efficiency.
Incentives for Liquidity Providers
Trading Fee Rewards: Liquidity providers earn rewards from trading fees by contributing liquidity to SEGA pools.
Farming Rewards: Key liquidity pools are incentivized with farming rewards to attract more participation.
Customizable Rewards: Projects can add additional reward tokens to encourage liquidity provision.
Empowering New Projects
New projects can use SEGA to:
Create Trading Markets: Launch new trading markets effortlessly.
Provide Immediate Liquidity: Ensure their tokens have liquidity from day one, enabling traders to buy in easily.
By utilizing SEGA, projects can quickly establish a functional market and attract users, creating a seamless experience for both liquidity providers and traders.
Powered by Solana
The underlying Solana blockchain enhances SEGA’s capabilities with its unmatched speed and efficiency, ensuring a smooth and cost-effective trading experience for all users.
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