Liquidity Pools

SuiDEX offers a dynamic setup for liquidity pools, featuring both Stable and Normal AMM curves.

Stable pools are designed for assets that are traded within a close price range, while Normal pools are used for non-correlated and volatile priced assets. The platform offers dynamic pools with fees ranging from 0.01% to 10% for Normal pools and 2% for Stable pools. These fees can only be modified using the LP governance system, with a 0.3% fee on total votes to prevent gaming the system.

SuiDEX's dynamic fee pool with governance allows for a powerful system and tool for many projects in DeFi and crypto. The platform has a built-in LP governance and delegation system, which allows for complex protocols to be built on top of it while also enabling dynamic fees within any LP pool.

Each LP pool has an LP fee set upon pair creation, ranging from 0.1% to 10%. The LP governance system permits the fee of the pool to be changed based on an account that controls more than 50% of the pool votes. The LP token supply balances directly correlate with the votes. However, an LP provider can choose to delegate their 'votes' to another provider, allowing parties to lobby for delegates and increasing their pool weight.

SuiDEX offers fixed and dynamic protocol fees. If the protocol fixed fee is set and is larger than the LP pool fees, LP providers do not earn any fees for trades. The protocol fixed fee will only be used early upon launch until LP TVL grows to a sustainable amount. The platform has opted for this design, instead of a multi-fee pool type, as the pool with the deepest liquidity is always the preferred option in comparison to others with lower fees and liquidity. Thus, it is better to concentrate liquidity within one pool and allow a governance system that allows for dynamic fees.

Last updated