Trading Contribution Calculator

To compensate the contribution of traders to the protocol growth

Traders are the critical driver of the protocol's income and growth. To convert their contribution into an actual return, AEE provides a dynamic fee distribution to traders according to their trading volume and PnL.

Mechanism

In the calculator, N pool and X trader will be defined.

N pool refers to the total amount of the distributed fee. To calculate it, the engine will take the TVL, Fee level and annualized level into consideration. To balance the impact, a min level of 5% will be set.

X trader refers to the percentage of traders who can be enrolled into the fee distribution. To balance the impact, a max level of 5% will be set. According to the trader's personal trading volume, X% of the most active trader will enjoy the distribution.

The formula is as follows:

According to the formula, there will have more traders and personal fee distribution as the Fee/TVL increase which means traders can enjoy the growth of the protocol.

  1. Reduce the traderโ€™s loss

The Trading Contribution Calculator mechanism helps alleviate the financial burden of trading losses for users on the PEX platform. By offering support through the distribution of protocol income, traders are more likely to remain engaged with the platform and maintain their trading activities, even during challenging market conditions.

  1. Encourage users to trade more

The Trading Contribution Calculator can instil confidence in traders to continue their activities on the platform. As the impact of losses is minimized, traders may be more inclined to refine their strategies, experiment with new markets, and trade more frequently. This can result in higher trading volumes, which benefit the platform and the $PEX ecosystem by attracting new users and creating a more robust market environment.

Last updated