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Currently liquidity and thus terminal price are fixed upon deployment of a vAMM.
However in the future we may wish to both:
Increase/Decrease Liquidity
Repeg the terminal price
Alteration of liquidity could be performed by passing a new invariant (k = x*y) and applying the ratio of the root of k to both the quote and base asset reserves. Doing so changes the liquidity without significant change in the terminal price (in theory).
Repegging the terminal price works slightly differently. Where terminal price is the price on initialisation or on the closure of all user positions.
Since in the Margined vAMM price = quote_asset_reserves/base_asset_reserves one approach could be to simply update the quote and base asset reserves. However, doing so would not allow us to immediately adjust the terminal price as all existing positions would not have been applied.
Therefore repegging must take into account the existing delta between the users positions to repeg directly.
The text was updated successfully, but these errors were encountered:
Description:
Currently liquidity and thus terminal price are fixed upon deployment of a vAMM.
However in the future we may wish to both:
Alteration of liquidity could be performed by passing a new invariant (
k = x*y
) and applying the ratio of the root of k to both the quote and base asset reserves. Doing so changes the liquidity without significant change in the terminal price (in theory).Repegging the terminal price works slightly differently. Where terminal price is the price on initialisation or on the closure of all user positions.
Since in the Margined vAMM
price = quote_asset_reserves/base_asset_reserves
one approach could be to simply update the quote and base asset reserves. However, doing so would not allow us to immediately adjust the terminal price as all existing positions would not have been applied.Therefore repegging must take into account the existing delta between the users positions to repeg directly.
The text was updated successfully, but these errors were encountered: