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21 sats \ 2 replies \ @mega_dreamer OP 14 Jul \ parent \ on: Predyx fees adjustment - feedback requested. oracle
Lets see how it goes - we're really not much interested in creating our markets.
Instead we want to encourage community driven, creators economy and give the creators the freedom to set their own fees and thus make the fees more competitive based on creators reputation. It will be interesting to watch how it will all plays out in the end.
This sounds great!
I'd create markets with 0.5% fee on each.
I'm already excited to put in markets on so many topics.
I certainly need to understand some logic behind liquidity for independant markets. What if a creator doesn't provide liquidity but the market gets very popular with many traders afloat. Wouldn't that serve as liquidity?
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Unfortunately with LMSR (AMM - Automated Market Maker) you must seed a market with some Liquidity. That's the rule of LMSR - blame Robin Hansen for it, he is the inventor of LMSR (https://x.com/robinhanson)
Once Predyx starts getting sufficient traders and volume, we'll switch to CDA (Continuous Double Auction) similar to Binance/Coinbase where markets will be made by limit buy and sell bids from the market makers.
Initially our approach will be hybrid - where you initially create a market with LMSR. If your market gets enough volume and traders, the market will auto switch to CDA. After switching CDA, you may withdraw your LMSR liquidity.
In a creator's economy, while you have the freedom to set your own fees and decide on initial liquidity - someone else can create a similar market with lower fees and higher liquidity and sway all your traders to his/her market. Thus your fees and liquidity has to stay competitive.
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