Side Pool & BNB Pool

Wombat is an avant-garde stableswap. It never stops innovating. It continuously brings more invention to the DeFi space.
Researching Wombat's Invariant discovered a dynamic pool that supports swaps between assets with different values as supplied by external oracles.
∑Lx⋅px⋅(rx−Arx)=D\sum{L_x \cdot p_x \cdot (r_x - \frac{A}{r_x})} = D∑Lx​⋅px​⋅(rx​−rx​A​)=D
​LxL_xLx​
 = Liability of token x (in token amount)
​pxp_xpx​
 = relative price of token x
​rxr_xrx​
 = coverage ratio of token x
​AAA
 = amplification factor
BNB Liquid Staking Pool
BNB liquid staking pool is the first dynamic pool on Wombat Exchange. Users can swap their tokenized staked BNB for native BNB tokens without waiting for the unstaking period.
Oracle
The BNB pool contract reads the BNB exchange rate of the tokenized staked BNB from respective staking contracts.
Risk of Impermanent Loss
Impermanent loss in Wombat's context is when the global equilibrium coverage ratio r∗r^*r∗
 decreases.
A pool is like an index that holds a basket of assets. If the price of its underlying assets changes, it is possible that r∗r^*r∗
 deviates from 1. However, it's pretty unlikely that the r∗r^*r∗
 of BNB pool will decrease. We expect the coverage ratio of liquid staking BNB to be higher than 100% and that of native BNB tokens to be lower than 100% as natural buy pressure is imposed on BNB. In that case, r∗r^*r∗
 monotonically increases.
However, by any chance r∗r^*r∗
 drops, the gap can be filled, and the coverage ratio can be pushed back to 1 with haircut fees accumulated.
The smart contract implementation, r∗r^*r∗
 is assumed to be 1 in deposit and withdrawal to simplify the calculation.
More details can be found on the side pool and dynamic pool whitepaper.
Last modified 3mo ago