Trading & LP Points

Trading Points

Takers earn points daily, based on their trading volume within the Mangrove DEX and a specific weight for each market.

For example, in the WETH/USDB markets, every $1 traded equals 1 point, motivating participants to increase their trading activity.

Liquidity Provision Points

One of the core goals of the MS1 Program is to reward a balanced orderbook, in order to do this, we currently reward those who keep their positions balanced at a higher rate than those who do not.

Because of this, you will gain greater rewards if you have bids and asks on the book at the same time, if you look at the paper linked below, you will see this:

$$D(m,t) = \min\left(\sum_i\frac{a_i^t}{s_i^t},\sum_j\frac{b_j^t}{s_j^t} \right)^d$$

What this means is that your points are based on the minimum points you gained from your asks and your bids. With no asks for example, you will get only a small reward.

Makers contribute to the ecosystem's health by providing liquidity, earning points for their crucial role, with a predetermined weight for each market. The best quality liquidity close to the market price and on both sides of the book gets rewarded the most.The distribution of points among makers isn't purely proportional to the volume generated by their liquidity.

The calculation encapsulates the essential contributions of Makers, rewarding consistency (uptime), market relevance (proximity to the spread), and the effectiveness of the liquidity provided (volume).

Competitive Makers: These are the pillars of market efficiency, providing liquidity that's on both sides of the book and closely aligned with the current market prices, thereby ensuring minimal spreads.

Non-Competitive Makers: Recognized for adding to the market's liquidity pool, these Makers might offer asymmetric liquidity at prices farther from the market's current rate. The program still rewards them but emphasizes encouraging more market-conducive offers over time.

For a detailed description of the MS1 points calculation, refer to the MS1 Whitepaper.