Buy crypto anonymously on the Incognito pDEX   

Automatic Liquidity Re-balancing?

#1

With the addition of KyberSwap and other coinswapping Dex’s like it. Will Incognito be implementing an automatic way to re-balance liquidity pools.

For example, if one not so popular coin has a lot of liquidity, and other more popular coins are lacking in liquidity, do you think it would be beneficial to distribute the liquidity evenly throughout the pools. This would make cashing out PRV only affect the total liquidity on the Incognito network instead of just a single pool.

Though there are fees associated with making transactions like that. Maybe users could vote with PRV to have the liquidity re-balanced. Once enough PRV is locked up to cover the cost of the re-balancing the network would Make trades to evenly distribute the liquidity.

I guess users could manually do it by exchanging pCoins with high liquidity pools to pCoins with low liquidity pools. They can then use those coins to provide liquidity on the network, evening things out. You might even be able to make some money doing it that way. Maybe this could be another form of steaking. You put liquidity in, and automatically if one of the pools are low and there is profit to be made, it takes the coins out, exchanges them, and provides liquidity for a coin that needs it more. No user input needed.

2 Likes
#2

From what I understand, in an upcoming DEX update, liquidity will be automatically balanced by making trades through prv. If you want to trace BTC fo ETH, for example, but there isn’t enough liquidity in that pair, it will trade BTC to PRV and then ETH in the background. But as for if there isn’t enough liquidity in the PRV pools, I’m not sure how balancing would help, except for redistributing prv. There wouldn’t be enough of the other asset in the pair, so it would only help for buying prv rather than selling. But then, for supported currencies, kyber would make a difference.

2 Likes
#3

This would be amazing for my XYO-PRV, since I cannot do these trades on here yet with the liquidity so very low even though I really want to, I have to stick to KuCoin to trade for USDT then send to incognito, for now. Cannot wait for this update so that incognito gets my trading fees with this one and not stinkin’ KuCoin!