5 posts tagged with "market-design"

Multiswap's Post-Trade Elasticity Model gives every token a reserve, a scale, and a marginal price. This article asks whether the same structure can support two directional claims associated with a Reserve Asset:

• BULL, whose return exceeds the Reserve Asset's return when that return is positive and falls more when it is negative;
• BEAR, whose return has the opposite sign and may have greater than one-for-one short exposure.

The accounting must come first. BULL and BEAR are both positive claims against the pool, so both are credit accounts. They are economically opposite because their prices respond differently, not because their ledger polarities differ. Once that distinction is fixed, double-entry accounting and post-trade value-flow conservation reduce the claim problem to a small system of exact finite equations.

The resulting research model has a general form for any homogeneous elasticity. When price elasticity and scale elasticity both equal one half, the claim solve becomes quadratic. A constant relative-claim elasticity $\kappa$ remains optional: $\kappa=2$ gives a particularly symmetric log-return geometry, while $\kappa>2$ is necessary if both BULL and BEAR must have greater than one-for-one exposure.

Scope: The operation classes below describe mathematical safety results. Current contracts expose Reserve Asset swaps and proportional LP liquidity; general coefficient updates and unequal liquidity baskets are not public operations. See Liquidity Operations.

This is the compact safety reference for the exact-arithmetic, claim-free Multiswap Reserve--LP system.

Multiswap creates unified liquidity markets for entire asset classes, then composes those markets into broader liquidity products. The fastest path to commercial traction begins with USD.cav: a curated USD market that wins a published execution matrix and gives every included Reserve Asset direct access to the same pool liquidity.

The commercial objective is concrete:

For a defined asset cohort and a defined set of trade sizes, Multiswap delivers the best net executable quote and earns organic routed volume.

Total value locked supports that objective. Execution quality, routed volume, fee revenue, and repeat usage measure the win.

Multiswap places a universe of $n$ Reserve Assets in one pool. This article compares its marginal execution-price impact with an equivalent Uniswap v2 star containing the same assets, initial relative prices, and aggregate initial reserves token for token.

The universe contains $n-1$ assets $A_i$ and one generic stablecoin called $\mathrm{USD}$. The first comparison studies a trade $A\to\mathrm{USD}$. The second studies an $A\to B$ trade, which Multiswap executes as one interaction while a Uniswap v2 star routes through USD.

For equal starting universes, the Multiswap execution-depth advantage is

The advantage increases with the number of assets $n$ and the scale elasticity $e_s$. Multiswap reaches parity with Uniswap v2 at

For the $A\to B$ comparison, the Multiswap advantage in the receive-side $B/\mathrm{USD}$ execution-price response is

Multiswap is a multi-asset exchange built from three native quantities: reserve, scale, and marginal price. The Post-Trade Elasticity Model specifies how those quantities change under an atomic swap, how LP Token liquidity actions extend the same state space, and which internal safety properties follow from the resulting coefficient dynamics.

The model has one central distinction:

• a token can move along a fixed elastic curve because its reserve changes;
• an operation can move the token to a different elastic curve because its coefficient changes.

This distinction unifies the reserve-to-price homomorphism with the complete price law. Swaps keep every Reserve Asset coefficient fixed. Liquidity actions can change the coefficients of nonparticipating Reserve Assets through one common multiplier. The complete transformation remains multiplicative. The reserve ratio describes the fixed-coefficient case, while the coefficient ratio extends the same structure to liquidity actions.

This article develops the complete framework from first principles. It covers atomic $m$-to-$n$ swaps, finite-step divergence, market depth, user-controlled splitting, LP Token liquidity, the exact liquidity-dispersion boundary, gauge-invariant safety, a qualified value-flow entropy, parameter changes, deposit phases, and the current implementation boundary.