Comment on page
Discover the mechanics of Basic Pools and the benefits of providing liquidity on Ociswap.
Ociswap's Basic Pool (
BP) uses Radix's native "Resource Pools" as a building block. In particular, it utilises the TwoResourcePool (
TRP), which is a liquidity pool that contains a pair of digital assets (e.g.
TRPholds the market's liquidity for a single pool and is exclusively managed by its corresponding
By making use of the
BPcan provide pool units (LP-tokens) that are fully compatible with the official Radix Wallet. This ensures a great user experience, because the Radix Wallet transparently showcases the underlying tokens, while allowing users to seamlessly access and intuitively manage their funds at all times.
To understand the design concepts of the
BP, it's crucial to grasp which functions are provided by the
TRPand how the
BPis built around it:
- 1.Instantiate Pool Allowing users to create a
BPwith a corresponding
TRPto hold its liquidity.
- 2.Add LiquidityAllowing users to provide liquidity to a
BP, which is deposited into the
Contributefunction. Liquidity is provided in token pairs, matching the pool's ratio.
- 3.Remove Liquidity Allowing users to withdraw their liquidity from the
- 4.Swap Allowing users to execute trades through the
BP. During the swap, the
Protected Withdrawfunctions of the
TRPto amend its token holdings.
Users can also interact with the
Redeemfunction of the
TRPdirectly from the Radix Wallet, allowing them to withdraw liquidity at any time.
- Swaps: The
BPuses a Constant Product Automated Market Maker formula to create a market and calculate prices and trading outputs.
- Liquidity Provider Fees: The
BPimposes fees upon swap execution, with the specific trading fee rate established during the liquidity pool's creation. These fees can be configured to 0.01%, 0.05%, 0.3%, or 1%. All fees are awarded to the liquidity providers of the
TRPand can be claimed by redeeming the underlying liquidity.
- Auto-Compounding: The
BPconsistently reinvests the trading fees back into the liquidity pool. This boosts returns and creates a hassle-free experience for liquidity providers.
- Basic Pools v0 are launched with the introduction of Babylon. These pools are set to transition to Basic Pools v1 once thorough code audits are completed.
- Locking liquidity is not enabled for the v0 pools.