Strategies -
Last updated
Last updated
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.