> For the complete documentation index, see [llms.txt](https://docs.symm.io/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.symm.io/getting-started/core-concepts.md).

# Core Concepts

## The Bilateral Model: PartyA and PartyB

Most crypto derivatives trade on order-book exchanges, where traders post bids and asks to a shared book and a matching engine decides when two orders meet. Symmio works differently. Instead of a centralized order book, a trader expresses an *intent*: a request that says "I want to go long (or short) this market, at this price, this size, with this collateral."

Once submitted, the intent is visible on-chain to a network of independent counterparties called [***solvers***](/getting-started/glossary-of-terms.md). Any solver can choose to take the other side. So rather than competing for queue priority on a central book, you declare what you want and let the market come to you. There's no central matching engine, which keeps the system permissionless and peer-to-peer.

This model removes the need for a centralized matching engine and makes the system permissionless, flexible, and peer-to-peer. It allows anyone to create and trade derivatives in a trustless manner, without relying on a central exchange.

<figure><img src="/files/QhoOeRnW8tBrSYYeVaFq" alt=""><figcaption></figcaption></figure>

Symmio has three main roles:

* [***Party A***](/getting-started/glossary-of-terms.md): the trader who creates an intent.
* [***Party B***](/getting-started/glossary-of-terms.md): the solver, or hedger, who chooses to accept it.
* [***Liquidators***](/getting-started/glossary-of-terms.md): impartial actors who watch open positions and step in if collateral drops below a safe level.

{% hint style="info" %}
See the [Glossary](/getting-started/glossary-of-terms.md) for more information.
{% endhint %}

When a solver accepts an intent, the position opens on-chain and collateral from both sides is locked into the protocol. To close, the trader submits a close intent, the solver handles it, and both balances update.

## Intent-based trading: how a trade happens

A trade follows a simple path:

1. **You submit an intent**, e.g. "go 10x long on ETH at this price."
2. **A solver sees it** and decides whether to take the other side.
3. **The solver locks it in**, and both sides lock collateral.
4. **The position is open**, live against that solver.
5. **You close when ready** by submitting a close intent; settlement happens on-chain.

This is unlike an AMM, where you swap against a pool, or an order book, where you match an anonymous resting order. Here a specific professional counterparty explicitly agrees to your trade.

## Collateral, margin, and CVA

A few terms show up everywhere. *Collateral* is the money you actually deposit, usually USDC; it's your balance in the system. *Margin* is the slice of that collateral backing a specific position: at 10x leverage, a $1,000 position needs $100 of margin. *CVA*, short for Credit Valuation Adjustment, is a small buffer locked on top of margin to protect against the other side defaulting. Think of it as a security deposit that covers the worst case if a counterparty can't pay.

They relate like this:

```
Collateral = Locked Margin + CVA + Available Balance
```

Opening a position locks margin and CVA. If a trade moves against you and your losses approach your total collateral, you're at risk of liquidation.


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