Nabla Docs
  • Nabla Finance
    • The problem Nabla solves
    • Benefits of using Nabla
  • Protocol Overview
    • Swap Algorithm
    • Liquidity Pools
      • Swap Pools
      • Backstop Pool
    • Oracle Details
      • Architecture
      • Pyth
      • Chainlink
      • EV:GO
  • Roadmap
  • Protocol-owned Liquidity (POL)
    • Trading Fees and LP Incentives
    • Nabla as an autonomous protocol
  • Security
    • Audits
    • Bug Bounty Program
  • Mainnet Alpha
    • Risks and Benefits of being a Mainnet Alpha LP
  • Monad Testnet
    • Add Monad Testnet to Metamask
    • Get Monad Test Tokens
    • Monad Testnet Tasks
  • Testnet Beta
    • Connect Wallet to Base Sepolia
    • Testnet Beta Tasks
    • Obtaining Base Sepolia Ether for Gas
    • Test Assets
    • Connect Wallet to Base Sepolia Testnet
    • Performing a Swap
    • Managing Swap Pool Liquidity
    • Redeem Swap Pool Shares via Backstop Pool
    • Managing Backstop Pool Liquidity
    • Withdraw Backstop Pool Liquidity via Excess Swap Pool
  • Testnet Alpha
    • Testnet Alpha Results
    • Whitelisting for testnet
      • Whitelist Campaigns List
      • $PYTH Stakers Whitelist
    • Connect Wallet to Sepolia Testnet
    • Requesting Testnet Gas
    • How to contribute to testing
    • Performing a Swap
    • Managing Swap Pool Liquidity
    • How to swap into a swap pool that is depleted
    • Managing Backstop Pool Liquidity
    • Redeem Swap Pool Shares via Backstop Pool
    • Withdraw Backstop Pool Liquidity via Excess Swap Pool
  • Liquidity Provision
  • $NABLA
    • $sNABLA Token Utility
    • Staking Mechanism
    • Fee Distribution
    • Tokenomics
    • Token Utility Summary
    • Governance
      • Initial Governance Implementation
      • Governance structure
      • Discussion and Proposal process
      • Voting process
      • Transparency and record-keeping
      • Code of conduct
      • Amendments to the Governance Framework
      • Template for a vote
  • $AMBER Onchain Points Program
    • Mainnet Alpha Rewards
      • Arbitrum-Mainnet Alpha Rewards
      • Base-Mainnet Alpha Rewards
    • $AMBER FAQ
  • đź’»Developers
    • Integration Guide
    • NablaPortal
    • NablaRouter
    • SwapPool
    • GenericPool
    • NablaBackstopPool
    • PythAdapter
    • ISlippageCurve
    • Contract addresses
      • Arbitrum One
      • Base
      • Monad Testnet
    • Contract errors
  • Community
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  • Whitepaper
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  1. Nabla Finance

Benefits of using Nabla

Nabla has four main target user groups that profit from using Nabla’s innovations:

  • Liquidity Providers: Better Risk-Adjusted Returns Nabla's unique design reduces the risks and drastically improves the risk-adjusted returns for liquidity providers by avoiding impermanent loss, and by separating the roles of token provision and risk-taking. This allows low-risk capital to be put to use in the single-sided Swap Pools and profit from swap fees, whilst less risk-averse capital can profit from the high ROI in the cash-neutral Backstop Pool.

  • Traders: Lower Slippage The intelligent, oracle-informed pricing allows for maximal capital efficiency (comparable to liquidity on Univ3 which would get rebalanced each block). This, combined with the low-risk single-sided liquidity provision, allows Nabla to operate with significantly lower slippage and competitive fees compared to other AMM designs. This helps to reduce the costs of swaps on DEX aggregators that have implemented the Nabla AMM.

  • Token Issuers: Drastically Reduced Liquidity Costs Token issuers can provide or attract deep liquidity for their tokens at much lower costs compared to other AMMs. This is thanks to the single-sided Swap Pools (which reduce the liquidity requirements by 50%), the extreme liquidity concentration (which further drastically reduces the capital needs), and the much higher risk-adjusted organic LP earnings (which reduces the need for additional incentives).

  • Arbitrageurs: Frictionless and Risk-free Arbitrage The lion share of swap volumes on classic passive AMMs like Uniswap or Curve comes from arbitrage transactions, which are essential for these AMMs to keep token prices updated to the current “fair value” (which is for most tokens found on the big centralized exchanges like Binance and Coinbase). Due to its intelligent, oracle-informed pricing, Nabla does not need this kind of arbitrage to keep the prices updated. On the contrary, Nabla can be used as counterparty by arbitrageurs to update the prices on passive AMMs - as Nabla instantly reflects changes in the current “fair token prices”, and offers deep liquidity with almost negligible slippage. The big advantage of using Nabla as counterparty instead of centralized exchanges is that arbitrage transaction can be set up atomically onchain, and thus risk-free for the arbitrageur (the arbitrage transaction on the passive AMM and the counter-trade on Nabla are bundled together - and either both go through, or none) - which is a significant edge over the classic AMM-CEX arbitrage, which can’t be set up atomically, and thus always comes with some residual risks.

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Last updated 5 months ago