Nabla Finance

Last updated 5 months ago

Nabla Finance

Nabla Finance is a novel yield protocol that generates sustainable organic yield for liquidity providers (LPs) through its underlying hyper-efficient Nabla Automated Market Maker (AMM). The Nabla AMM is offering its liquidity exclusively to bots and autonomous agents, which allows for certain optimisations in the pricing algorithm. The Nabla AMM tech is optimised to profitably offer deep liquidity for crypto, certain real world assets (e.g. stables/forex, treasuries, commodities) and yielding assets (e.g. LST and LRT). Its innovative architecture almost entirely avoids impermanent loss (IL), whilst offering the highest possible capital efficiency. This enables much higher risk-adjusted returns for LPs, and lower swap costs for the bots that use this liquidity. Key features of Nabla AMM include:

Intelligent, oracle-informed pricing The swap ratios are calculated based on external oracle prices from offchain markets, and additional onchain slippage curves for the involved assets, which depend on the current pool imbalances and the historic volatility of the respective asset. In combination with our volatility protection mechanism , this almost entirely avoids Impermanent Loss, and allows for the highest possible capital concentration around the current oracle price.
Separation of Asset provision from Risk-taking Liquidity providers can either deposit into the low-risk single-sided Swap Pools, or into a dedicated Backstop Pool. The Backstop Pool achieves a higher ROI, but covers the residual IL risk, and all other remaining risks in the system.
Low-risk single-sided Swap Pools Liquidity Providers in the Swap Pools are not exposed to IL or other market making risks (which are covered by the Backstop Pool). These pools therefore have a risk profile closer to lending protocols than to classic AMM pools. Furthermore Nabla works without a pairing asset, which as well reduces the required capital to achieve a certain amount of swap liquidity. All this allows Nabla to attract deep swap liquidity at much lower costs.

NextThe problem Nabla solves

Last updated 5 months ago

Intelligent, oracle-informed pricing The swap ratios are calculated based on external oracle prices from offchain markets, and additional onchain slippage curves for the involved assets, which depend on the current pool imbalances and the historic volatility of the respective asset. In combination with our volatility protection mechanism , this almost entirely avoids Impermanent Loss, and allows for the highest possible capital concentration around the current oracle price.
Separation of Asset provision from Risk-taking Liquidity providers can either deposit into the low-risk single-sided Swap Pools, or into a dedicated Backstop Pool. The Backstop Pool achieves a higher ROI, but covers the residual IL risk, and all other remaining risks in the system.
Low-risk single-sided Swap Pools Liquidity Providers in the Swap Pools are not exposed to IL or other market making risks (which are covered by the Backstop Pool). These pools therefore have a risk profile closer to lending protocols than to classic AMM pools. Furthermore Nabla works without a pairing asset, which as well reduces the required capital to achieve a certain amount of swap liquidity. All this allows Nabla to attract deep swap liquidity at much lower costs.