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Which curves do liquidity pools on Stabull DEX use?

Stabull is a 4th generation AMM, that enables the purest form of stableswaps. 

Stabull’s pricing curve is dynamic and takes elements of Uniswap V3’s concentrated liquidity model and traditional pricing curves like the one used by another stablecoin exchange, DFX,  to create a hybrid model that maximizes capital efficiency. The Above chart (roughly) illustrates liquidity distribution at different prices for a DFX pool (blue line) vs. a Stabull pool (orange line) which spreads liquidity slightly and eliminates the “no slippage” zone (flat and steep).

The key consideration here is that the orange Stabull curve lessens price stability (higher slippage) for smaller trades (represented by the gray area), but increases price stability (less

 slippage) for larger trades (green area). This is designed to continually create value incentives to maintain or move the pool back to 50% and balance them.

Another element of the Stabull price curve is the usage of price oracles. The exchange rate output by Stabull is a combination of an oracle price provided by Chainlink and an external exchange rates that is offered by other exchanges, such as Uniswap, Curve, or centralized

 exchanges. Internal exchange rate stability (low slippage) must be balanced by

 liquidity provision from a variety of external exchange rates (to protect the draining of

 the pool). 

The swap rate offered to a user differs from the Oracle rate fed to it by external sources 

The above chart evidences how NZDS being added to the pool affects the exchange rate. The blue curve shows a larger flat section(zero-slippage), controlled by DFX beta parameter, but a steeper curve at the tail (delta parameter). Conversely, the orange curve shows a small

 lat section (small beta), and shallow tails (small delta). As a result, the orange curve incurs more slippage on small trades (gray area), and less slippage for larger trades, compared to the blue curve.

There is more information about the various elements of Stabull’s pricing curve in the whitepaper (stabull-whitepaper-v1.pdf)

Still need help? Check out our knowledgebase, ask one of our helpful community members on the Stabull Discord, or submit a ticket via our helpdesk to our team for help.

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