Oracle+vAMM Price Discovery

SakePerp Protocol uses the Oracle+vAMM curve for price discovery.

  • SakePerp starts with a vAMM curve price equal to Oracle price.

  • Before Oracle price updates again, the transaction price will be decided by the virtual AMM curve x * y = K, which is the same as Uniswap.

  • After the Oracle price is updated, the curve will update to the latest oracle price. Then new transactions will start from the latest Oracle price and follow the vAMM curve again. Oracle + vAMM is the most important mechanism of SakePerp Protocol, which can track the price of the spot market in time.

  • The virtual liquidity of AMM is determined by the number of funds provided by MM, the volatility of the underlying asset, and the transaction volume.

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