ActaFi Swap

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ActaFi Swap
ActaFi Swap works with an Automatic Market Maker (AMM), which is a smartcontract that regulates trading. Since smartcontracts are decentralised, users do not have to trade the order book of an exchange. Instead, they effectively trade with other users’ provided liquidity.
Concentrated Liquidity
The AMM protocol on ActaFi Swap makes use of concentrated liquidity, instead of passive liquidity. While previously all liquidity providers, other than Uniswap v3, provided liquidity passively across all available prices. Meanwhile, concentrated liquidity enables liquidity providers to choose limited price ranges to provide liquidity to. This allows for active strategies similar to market-making in traditional order book markets.
The returns of passive liquidity providers have decreased significantly with the introduction of concentrated liquidity, like on Uniswap v3. This is a direct result from active liquidity providers earning on average significantly more fees than passive LPs.
Token Bridges
Token bridges are a successful innovation to the DeFi industry, allowing users to migrate liquidity and assets from one network to another. Utilising token bridges, users are able to escape congested, slow, and expensive networks to use their assets in DeFi ecosystems that run on faster and cheaper networks.
To make an even better use of token bridges, ActaFi Swap will utilise token bridges to tap into asset liquidity on other networks as well before using the liquidity aggregator, to provide the best price possible for the buyer / seller.
Liquidity Aggregator
ActaFi Swap is a liquidity aggregator that accumulates (mutual) liquidity pools of the same asset available on a set of different platforms. While trading on the ActaFi Swap, users not only trade with the ActaFi Swap liquidity pools, but also tap in the available liquidity on other Avalanche-based swaps, such as TraderjoeXYZ, Pangolin and others. As a liquidity framework, we facilitate the best possible outcome for the traders.
Combined with token bridges, that work as a secondary function on the backend, ActaFi Swap taps into an asset’s liquidity on any network.
Swap fee
ActaFi Swap offers the opportunity for liquidity providers to choose which swap protocol fee they provide liquidity to. At origin, there will be 3 liquidity pools available for liquidity providers to choose from:
The AMM protocol automatically routes through the liquidity pools of ActaFi Swap, and connected liquidity pools, arbitraging across price differences, to get the most valuable outcome for the trader.
Listing
Anyone can list a token on ActaFi Swap, but the listing entity will have to lock a minimum amount of liquidity for 12 months. Users will be able to report malicious token duplicates and get a reward in ACTA Tokens for their contribution to protect the traders. Projects have the possibility to set up farming pools on Acta Finance to incentivize liquidity providers.
Swapping fees are immediately deposited into liquidity reserves. This increases the value of liquidity tokens, functioning as a payout to all liquidity providers proportional to their share of the pool. Fees are collected by burning liquidity tokens to remove a proportional share of the underlying reserves.
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Last modified 4mo ago
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Concentrated Liquidity