00:00:00
in order of um whoever kind of submitted
00:00:02
their uh the strategy first. So um so
00:00:06
yeah, so that's how it works. One sec,
00:00:08
let me where? Okay, so um yeah, so the
00:00:11
first one we'll look at is called is
00:00:14
called LP hedging with shorting on sex
00:00:18
and it comes from Basilus. Um and and
00:00:21
yeah, Basilis like afterwards I'll give
00:00:23
you an if you're on I'll give you an
00:00:25
opportunity to like answer questions
00:00:26
about your strategy as well. Uh but uh
00:00:29
overall um I was pretty impressed with
00:00:31
sorry let me back to here. This is
00:00:33
working this button. Okay great. So
00:00:36
let's let's take a look at sales
00:00:38
strategy here.
00:00:43
Um so overall I think this is kind of
00:00:46
strategy that makes a lot of sense for
00:00:47
bot because this takes advantage of the
00:00:50
new Solana DEX connectors and um it
00:00:54
basically tries to implement uh a
00:00:56
position where you can enter a position
00:00:58
on on a DEX LP and you can short that.
00:01:01
You can basically maintain a short and
00:01:04
basically try to profit from you know
00:01:06
earning fees on the LP uh versus
00:01:09
maintaining the short and hedging your
00:01:11
your asset risk. So, uh, I I I think I
00:01:15
really appreciate what facility did here
00:01:17
because he he basically used the newest,
00:01:20
you know, the work in progress branch of
00:01:23
of gateway to do this. Um, and uh, yeah,
00:01:27
even though uh, yeah, even though um, it
00:01:30
was still very much work in progress, he
00:01:32
managed to figure it out. uh he built he
00:01:34
actually added functionality I think in
00:01:36
his pull request here that I think we
00:01:39
should actually build into um the actual
00:01:41
core functionality gateway he had he had
00:01:44
this LP management you know module here
00:01:46
so so anyway so I I was very very
00:01:48
impressed with his uh strategy um and uh
00:01:51
yeah so here's his uh
00:01:57
video all
00:01:58
right hello everyone and welcome to my
00:02:02
presentation titled delta neutral amml
00:02:06
be hedging with sorting on a centralized
00:02:08
exchange. So let's get into it. What's
00:02:12
the big idea behind the project is
00:02:15
that many liquidity pools offer very
00:02:18
attractive yields.
00:02:21
However,
00:02:23
uh when one side or both sides of the
00:02:26
pool are volatile
00:02:28
assets, then we can
00:02:31
lose a lot of the value of our
00:02:33
inventory, at least in USD
00:02:36
terms if the price swings heavily to the
00:02:40
downside. So the goal of this strategy
00:02:45
is
00:02:46
to to hedge the volatile asset of the
00:02:50
liquidity pool on the centralized
00:02:53
exchange. So in this projects we always
00:02:57
assume that one side of the pool is a
00:03:00
stable coin.
00:03:03
As an example, we could provide
00:03:05
liquidity into Solana USDC pool on radio
00:03:10
while
00:03:11
simultaneously shorting Solana on a
00:03:15
centralized exchange like
00:03:17
OKX. So, how does this strategy work? We
00:03:22
use a directional trading controller
00:03:25
that checks both liquidity pool position
00:03:28
and our short position at regular
00:03:31
intervals. for example, 10
00:03:34
seconds. And at each
00:03:37
check, the controller can decide whether
00:03:40
to open a new liquidity pool position if
00:03:43
it doesn't exist or use the existing
00:03:47
one. It can
00:03:49
also decide whether to open to to adjust
00:03:53
the short or open a new one according to
00:03:55
configuration.
00:03:57
when stopping the bot it can also decide
00:03:59
whether to stop the shorting
00:04:02
the the liquidity close liquidity pool
00:04:05
or do both according to the
00:04:07
configuration. So the key objective here
00:04:10
is to keep the short on the centralized
00:04:13
exchange as close as possible to the
00:04:16
amount of the volatile asset in the
00:04:19
liquidity
00:04:20
pool. For this we define a rebalance
00:04:23
percentage for example 5% as we'll see
00:04:27
afterwards and if the difference between
00:04:30
the volatile asset amount in the pool
00:04:33
and the short size exceed 5% then we
00:04:38
adjust the
00:04:40
short.
00:04:42
So with
00:04:44
this let's see a sample configuration of
00:04:47
our strategy. So we see that we use a
00:04:51
OKX perpetual and the trading pair
00:04:53
Solana USD and we have to set the
00:04:56
address which is the Solana USDC pool on
00:04:59
radio and you see this is a clmm and we
00:05:02
also define this pool AMM faults. We see
00:05:05
the rebalance percentage is 5% and the
00:05:09
the interval 10 seconds and here we see
00:05:13
that we will not use any existing short
00:05:16
size and also close everything when
00:05:19
stopping the bot. We also have to
00:05:21
provide information for opening the pool
00:05:23
like for the range and how much of the
00:05:26
base asset how much Solana and how much
00:05:29
USDC we need. Okay. So now let's run the
00:05:32
bot. So hey okay so now the bot is
00:05:37
running and we see here that on radium
00:05:40
has opened a position where almost
00:05:44
0.38 sana and on okayx we have a short
00:05:49
almost
00:05:52
0.39 let's see some key metrics to that
00:05:56
we monitor so here we see for example
00:06:01
the the entry high the entry price and
00:06:04
the entry time which uh which are key
00:06:06
metrics and the rebalance percentage
00:06:08
which is at 5% and the current
00:06:11
divergence is at 1 18%.
00:06:14
We see the size shorted on the on the
00:06:18
decks and the actual size on the
00:06:21
pool. And we have profitability which is
00:06:24
the the difference of the initial value
00:06:27
of the pool and the current value. And
00:06:29
we also have the portfolio value. The
00:06:32
same for the whole portfolio value that
00:06:35
includes that includes the the amount on
00:06:38
the centralized exchange and also
00:06:41
includes the the fees. We also have AP
00:06:44
APY but if you don't run it more than
00:06:46
one day uh the these are
00:06:49
meaningless and we also have the last
00:06:52
update. So as a future
00:06:55
improvements I intend to implement dual
00:06:57
asset hedging so that you one can enter
00:07:00
pools that both assets are
00:07:04
cryptos. Another good improvement be
00:07:06
onchain shorting. So to have a to to do
00:07:09
the short on the per deck on on Solana
00:07:12
so that we can have a we can move
00:07:16
liquidity from the fbs to to the pool
00:07:19
and vice versa very easily and of course
00:07:22
there can be al algorithmic enhancements
00:07:26
on the shorting and a lot of uh strategy
00:07:30
combinations. So I would be very happy
00:07:32
to discuss potential improvements and
00:07:34
strategy combination combinations with
00:07:37
uh all of you. Thank you very much uh
00:07:40
for your attention.
00:07:47
Um
00:07:50
great that was great actually. I really
00:07:53
enjoyed that. It was very clear um and
00:07:55
uh and and uh and concise. Um, I also
00:07:59
wanted to give Basilus an opportunity to
00:08:02
uh answer any questions about uh his
00:08:05
strategy that he may want. So, so yeah.
00:08:07
So, um, did anyone have questions for
00:08:09
Vasil? I think he's on right now. I
00:08:11
think he is. Uh,
00:08:24
yeah. Um, yeah. Yeah. So yeah, feel free
00:08:28
to unmute your mic. Uh but so we have a
00:08:31
couple questions in the chat. So Andy uh
00:08:33
says, you know, we hear would love to
00:08:35
hear about what kind of some of the the
00:08:37
issues that you face with Gateway. Uh
00:08:39
and um yeah, and Waffles would kind of
00:08:41
like like I think he kind of wants to
00:08:43
understand like how you're thinking
00:08:45
about um progressing these LP management
00:08:47
strategies.
00:08:51
Yes. So for the first question for
00:08:55
gateway I think the biggest problem for
00:08:57
me was opening and closing positions
00:09:01
uh and
00:09:04
uh one of the of the the biggest
00:09:07
difficult factors was the RPC endpoint.
00:09:11
So the default RPC endpoint needs a lot
00:09:14
of uh uh of of retrying and I I I even
00:09:20
had to to change the TypeScript and put
00:09:22
another package to
00:09:25
retry but then I I changed to another
00:09:29
RPC
00:09:30
uh I don't remember it now. Yeah, that
00:09:33
was that is still free and
00:09:35
um it it worked better. And another
00:09:39
thing is the what what the gateway
00:09:43
reports as
00:09:46
the as the amount let's say of Solana
00:09:50
that you have if it includes the the
00:09:52
fees or not and sometimes I see
00:09:55
something a little bit different on the
00:09:58
UI and so this was these were the
00:10:03
difficulties and uh I am keen to help
00:10:06
also going forward because I want to
00:10:09
advance my strategy. And for the second
00:10:12
question,
00:10:15
uh uh there are many pathways to to to
00:10:19
improve the strategy and I'm also
00:10:23
uh I don't know what to choose first. So
00:10:28
one thing is to to hedge for for two
00:10:32
assets because for example I'm also in
00:10:35
some pools with radium and Solana and I
00:10:38
would like to apply it
00:10:40
there. Another thing is
00:10:44
to to to short on a deck on Solana so
00:10:50
that you can move your liquidity around.
00:10:54
Um and uh there is another um motivation
00:10:58
for this. It's the fees. So the fees
00:11:03
uh the fees for example I saw on radium
00:11:06
if you are a maker they are zero or on
00:11:09
drift uh minus one basis points and
00:11:14
while on a kx they amount to a lot. Um
00:11:19
yeah and there are other crazy stuff you
00:11:21
can do if you you can decide not to sort
00:11:24
everything according to other metrics
00:11:27
that you have. Maybe you can combine it
00:11:29
with other strategies when to enter then
00:11:32
how to
00:11:33
rebalance because the clm will need also
00:11:37
rebalancing and opening closing and
00:11:40
reopening.
00:11:43
top. So there are a lot of things that
00:11:46
can be done.
00:11:49
Yeah, pretty good. Basil is just to
00:11:53
contribute a a few some some feedback
00:11:56
then I will also if you want we can
00:11:58
continue discussing and you can ask me
00:12:00
questions on whatever you need. But I
00:12:04
think that going to full decks that can
00:12:06
be really cool. Not only
00:12:09
for not only for the fees but also for
00:12:13
the facility of having the assets in one
00:12:17
place because if you are hedging your
00:12:20
position and you are like playing more
00:12:24
tight with the with the inventory that
00:12:27
you have at some point you need to close
00:12:31
the LP position like remove the
00:12:33
liquidity transfer the assets to
00:12:35
OKX to fund the short or you need to
00:12:38
like think about
00:12:40
rebalance some rebalance logic to
00:12:43
maintain your positions once you start
00:12:45
growing and adding more and more ranges.
00:12:49
So thinking about moving everything to
00:12:51
Solana, I think that is a really good
00:12:53
idea.
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