Markets
Introduction to Markets
Last updated
Introduction to Markets
Last updated
Underlying Perennial is a three-sided market, consisting of longs, shorts & makers, that trades synthetic exposure derived from a price oracle, over a given payoff function. Each market is independent & has isolated risk.
A Market in Perennial is defined by things like:
Interest Rate
Makers can provide liquidity to the market various ways:
From , which contain USD collateral to be utilized back taker positions
From Advanced LPs, who've leveraged their collateral to a specific market
Implications of this worth calling out:
Payoffs are fully synthetic — There can be a Perennial market for any price feed (or any programmable deviation of that price feed). A market could theoretically be created for crypto tokens, currencies, commodities, or any other non-manipulable price feed.
Each price feed may have multiple markets — There may be a Long-ETH market with the payoff function 1*ETH, and a Short-ETH market with the payoff (-1)*ETH)
Each payoff function may have multiple markets — There may multiple Short-ETH markets (payoff: (-1)*ETH), each with its own utilization curve, fees structure, parameters, etc.