Liquidity Providers

Traders are the true liquidity providers

Liquidity providers between AMMs and Standard Exchange are fundamentally different. While liquidity providers are passive ones who sit on their money in each pair of AMM now being unprofitable with active JIT liquidity bots, Standard Exchange liquidity providers are the active traders who match the orders to the market price where people agree to be fair.

	AMMs	UniswapX	Standard Exchange
Liquidity Providers	Passive LP Depositors	Active Traders	Active Traders
Required assets to provide liquidity	Base and quote of pair	Base or quote of pair	Base or quote of pair
Trading Assets With	Swap	Dutch auction from 1700s(?)	Making Order / Taking Order
Reward	Illegalized Staking or Airdrop	N/A	Action based
Revenue Sharing	Only liquidity providers	N/A	All registered traders
Algorithm	x*y=k, x+y=k, or constant equation for one liquidity distribution	Dutch Auction from 1700s(?)	Greedy Algorithm
Transparency	Fully on-chain	CEX-like dark pool, Off-chain settlement	Fully on-chain

Trader Points

In Standard Exchange, trader performance is quantified using Trader Points (TP). These points are assigned to traders based on the volume of each order they execute, which is recorded over an era, a 30-day period in approximate block finalization time. The accumulation of Trader Points enables traders to access various benefits within the Standard Exchange ecosystem, such as redeeming fees, receiving fee discounts, and participating in governance processes. By measuring and utilizing Trader Points, Standard Exchange establishes a transparent and incentivizing framework that rewards traders for their trading activity and encourages active participation in the platform.

$$TP ≒ {volume \ in\ unit \ of \ account\ (USDT,USDC,CBDCs, etc)}$$

Trader Impact

In Standard Exchange, trader performance is assessed by comparing their contributing points to the total points, providing a relative measure of their performance in relation to other traders. This evaluation framework allows for a clear understanding of a trader's performance within the Standard Exchange ecosystem. Moreover, Standard Exchange introduces the concept of Trader Impact (TI), which signifies the level of influence a trader holds within the Standard Exchange economy. The TI metric serves as an indicator of how influential a trader is in shaping the dynamics of the Standard Exchange marketplace. By utilizing these evaluation methods, Standard Exchange fosters transparency, fairness, and a deeper comprehension of a trader's contributions and impact within the platform's economy.

$$TI(\%) = ({Liquidity Points} / {Total Points})*100$$