Token Swaps on WarpGate
Last updated
Last updated
WarpGate introduces a dynamic liquidity pool system, offering flexible fee tiers ranging from 0.05% to 1%. This structure ensures efficient token swaps while balancing the needs of traders and liquidity providers (LPs).
0.05% β 0.15%: Designed for stable pairs, minimizing fees for predictable markets.
0.3%: For volatile pairs, balancing cost-effectiveness with LP incentives.
1%: Reserved for high-risk pairs, providing LPs with higher returns to offset potential impermanent loss.
WarpGate's fee structure adapts to market conditions and user feedback, creating a dynamic and competitive trading environment. While initial liquidity dispersion may occur, convergence is anticipated as the market establishes its equilibrium.
The tiered fee model minimizes risks for LPs by aligning fees with market volatility. High-risk pairs are incentivized with higher fees, fostering healthy liquidity provisioning across the platform.