How QIC-AMM works and how it fit derivatives trading.
Knowing that Uniswap’s constant function automated market maker does not fit derivatives trading for it will leave risk free arbitrage opportunity for professional traders. With years of experience on trading system, YFX team invent QIC-AMM.
QIC-AMM is short for Quoted Index Price and Constant Integral Based Automated Market Maker. It is an automatic market maker trading protocol based on the dynamic depth of index price quotation and constant integral.
QIC-AMM quote price from centralized exchanges. Traders use this price to open or close position with an automatic market maker. The trading depth is related to the fund in market maker’s pool.
The QIC-AMM capture the spot prices of multiple centralized exchanges to form an index price. When user place an order, the user only needs to enter the margin, leverage and direction, smart contract will lock the user’s margin at the same time. QIC-AMM will use the index price at the time when order data put on chain. There will be a price deviation due to the on-chain process will need at least one block time to process. Users can set slippage tolerance to protect a sudden market swing. At the same time, market maker will lock a certain amount of margin from the available balance of the market maker pool together with the user’s margin in one smart contract.
The market maker pool fund is correlated to the maximum position value for users, without sufficient funds, the smart contract will not allow a position to open. YFX uses a constant integral function to set the available balance in the market maker pool to normal distribution. Users can add liquidity to market makers pool, to get LP token.
QIC-AMM can not only ensure the fairness and timeliness of user transactions, but also the security of the system.
— — — — — — — — — — — — — — — — — — — — — — — — — — — — — — —
For more information:
Website: https://www.yfx.com/
Twitter: https://twitter.com/YFX_COM
Telegram: https://t.me/YFX_COM
Discord: https://discord.gg/xwAtjpabC5
Media Contact: media@yfx.com
