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Liquidity management/Protocol procedure for liquidity management system
Liquidity management
Liquidity can be thought of as a large pool of money that is split into half between $WDF and $BNB tokens. There is a conversion ratio that is set to the amount of $WDF that can be obtained through BNB, for example: 1 BNB equals 30.22 $WDF. When someone purchases $WDF, the price per $WDF rises, and the ratio above changes to account for this. The same is true for sales in the opposite direction. Liquidity allows anyone to buy and sell their $WDF/BNB at any time, but the less money/liquidity there is in the pool, the lower the price you get, so what our liquidity management system does is add more liquidity to that pool on its own, thereby resolving that issue.
Protocol procedure for liquidity management system
Our $WDF liquidity management system will infuse automatic liquidity into the market every 36 hours. There is a 2% and 2% tax fee on each buy or sell order respectively, that is automatically stored in the Liquidity wallet, and built into our protocol's smart contract is the process that smartly takes 50% of the amount of $WDF stored in the wallet and will automatically purchase BNB at the current market price. The remaining 50% of $WDF within BIF wallet are used for the $WDF side of liquidity, resulting in a split weighting of $WDF/BNB, which will then be automatically assigned as new, additional liquidity into market pairs, increasing the pool's liquidity
Last modified 10mo ago