Single-sided Liquidity Pools Explained
Last updated
Last updated
Single-sided Liquidity Pools are the ideal way for users to DCA into or out of NFTs. By setting and providing either EGLD or NFTs for their pool, they can start automatic DCAs for NFTs.
Creating a buy pool allows users to place multiple buy bids. For example, you could set up a buy pool with 5 bids, beginning at a spot price of 5 EGLD, using an of 10%. The system will automatically arrange the 5 buy bids at prices of 5 EGLD, 4.5 EGLD, 4.05 EGLD, 3.645 EGLD, and 3.2805 EGLD. Each subsequent bid is 10% less than the previous one, aligning with the exponential delta.
Context: It's called a buy pool, because you, the pool creator, want to buy NFTs. This is great for DCAing into NFTs.
In a sell pool, users can offer a set number of NFTs for sale. For instance, a sell pool with 5 NFTs can start at a spot price of 5 EGLD, with a of 0.5 EGLD. The AMM will set up the sell orders for the 5 NFTs at incremental prices of 5 EGLD, 5.5 EGLD, 6 EGLD, 6.5 EGLD, and 7 EGLD. The price will adjust upwards only after each NFT is sold, following the linear delta pattern.
Context: It's called a sell pool, because you, the pool creator, want to sell NFTs. This is great for DCAing out of NFTs.
These single-sided pools, whether for buying or selling, simplify the trading process for your NFTs. They allow for flexible control over pricing and ensure that your assets are traded systematically, according to the predefined parameters of the pool.
Imagine you're setting up a buy pool for NFTs. You deposit enough EGLD to cover 5 bids, starting at 5 EGLD. The AMM will place these bids decreasing by 10% each time, allowing you to potentially purchase NFTs at lower prices if the market conditions favor buyers.
For a sell pool, if you have 5 NFTs to sell starting at 5 EGLD, the AMM will list them at gradually increasing prices. This means the first NFT is listed at 5 EGLD, and if it's sold, the next one is listed at 5.5 EGLD, and so on. This strategy can maximize your returns if demand for your NFTs increases.
In summary, single-sided liquidity pools on JewelSwap offer a structured and user-friendly approach to NFT trading, allowing market participants to strategize their buys and sells with precision. These buy and sell pools are ideal ways of DCAing into or out of NFTs.