Strategies -
Through A51 X BaseSwap, a liquidity provider (LP) has the option to create strategies that dynamically adjust liquidity based on macro market trends. Some of the key strategies include:
1 | Bull | Best for bull market. This mode functions like a dynamic range order that follows the price of the tokenB asset up. | Rebase will happen on the right side of the price. This strategy is for LPs who expect ETH to go up. |
2 | Bear | Best for bear market. This mode functions like a dynamic range order that follows the price of the tokenA asset up. | Rebase will happen on the left side of the price. This strategy is for LPs who expect ETH to go down. |
3 | Dynamic | Best for sideways (volatile) market. This mode functions like a dynamic range order that follows the pool price right and left, keeping liquidity as active as possible. | This is how ALMs work, best for volatile markets with no clear direction. |
4 | Static | Best for advanced liquidity strategies. This mode features static ticks that you can use to define your own custom liquidity strategy. | Static liquidity used for building more sophisticated LP strategies. |
Bull Mode: In this mode, the position trails the current pool price as the asset price rises, optimizing for upward market trends.
Bear Mode: Here, the position trails the current pool price when the asset price is declining, ideal for downward market trends.
Sideways Mode: This mode allows the position to trail the current pool price in both upward and downward directions, making it suitable for markets with little to no clear trend.
Static Mode: In this setting, the position remains fixed and does not trail the changing prices of the underlying assets, offering a more stable approach.
Market modes will allow LPs to choose the direction of rebasing giving them greater control over their liquidity.
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