Section III. - Solutions
SYMMIO's Solution to Liquidity Concerns: Drawing Inspiration from Orderbooks and vAMMs
Section III. SYMMIO's Solution to Liquidity Concerns: Drawing Inspiration from Orderbooks and vAMMs
In trading, liquidity is king. And within the SYMMIO framework, ensuring liquidityâespecially when a hedger fails to respond to a selling userâis critical. To ensure Users will always be able to close a trade in time, even if a Hedger is not responding, we came up with the the first streamlined Disputable action to force close a position.
Force close Types
Force Close via Oracle Section IV. - FC (oracle)
Introduced in SYMM v0.83, the force close is a straightforward yet potent tool that was among our earliest ideas for a streamlined dispute system. Designed as an immediate response to hedgers failing in their role, it functions by enabling users to close their trade based on an oracle price.
Pros:
Efficiency: Acts promptly without extended protocols.
Simplicity: Easily understandable even for newcomers.
Deterrent for Hedgers: It penalizes hedgers just enough to encourage honest behavior.
Cons:
Oracle Dependency: Relies heavily on oracles for pricing.
Proving Non-Response: Establishing a hedger's non-response is challenging and opens the door to potential user exploitation.
Force Close via Open Market Section V. FC (open)
To be rolled out in SYMM v1.5, the open market for closing presents a radically different approach. Instead of relying on oracles, it banks on an open, free market system to solve liquidity concerns.
Pros:
Oracle Independence: Operates without the need for oracle inputs.
Proving Non-Response Unnecessary: No need to demonstrate hedger non-responsiveness.
Free Market Dynamics: Ensures that market forces determine prices.
Cons:
Liquidity Requirement: The system needs ample liquidity to function smoothly.
Complexity: Implementing this model can be intricate.
Not a Panacea: May not address all liquidity challenges.
In sum, SYMMIO's strategies for liquidity assurance draw from the best of both worlds, incorporating the dependability of orderbooks and the flexibility of vAMMs. Each tool, with its unique set of advantages and challenges, ensures that users have multiple avenues for seamless trading even in the face of hedger inactivity.
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