This SCCP proposes the following updates to Atomic Exchange Contracts:
atomicPriceBufferon trades pertaining to
atomicExchangeFeeon trades into of
EURto 20 bp
atomicMaxVolumePerBlockfrom sUSD 5 million to sUSD 15 million
The parameters being updated as are as follows
atomicPriceBufferis a parameter that worsens the chainlink price in the calculation of atomic exchange prices
atomicExchangeFeeis the fee applied on trades into a certain synth
atomicMaxVolumePerBlockis the max volume allowed for trading per block
This SCCP aims at improving the configuration of the atomic exchange function as to promote more exchange volume and integrations. Below are the main motiviations behind these parameters changes:
- To calibrate the
atomicExchangeBuffer, we can see from the BTC and ETH price charts that a 30 bp fee is more than enough to cover 90% of the delta observed between the AMM price and the cex price. It should be mentioned, that toxic flow in the form of oracle front-running is considerably harder with atomic exchanges, due to the round trip of 60 bp.
- To calibrate the fee applied on exchanges into
EUR, we can look at the delta between the price observed purely from chainlink against prices seen on cex which reveals that a 20 bp fee covers most of the delta.
- Finally on the
atomicMaxVolumePerBlockparameter, given the liquidity on
BTCin uni-v3 pools and the large number of trades that occur throughout the day, it becomes too costly to take manipulate the pools in order to move the price due to the TWAP and chainlink protection.
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