Carmine Options AMM
  • Intro
  • What we are aiming for
  • Audit
  • Carmine Academy
  • How to use the app
  • Use cases
  • Organization
    • Team
  • Mechanics - Basic Overview
    • Liquidity Pools
    • Initialization of new pairs and new options
    • Price Adjustments
    • Examples
  • Tokenomics
    • Tokenomics
    • Token Allocation
    • Distribution of Fees
    • Voting about Treasury and community projects
  • Usage
    • For Hedging
    • For Speculation
    • For Trading
    • Arbitraging the AMM
    • Future Use Cases Unlocked by the Composability of DeFi
      • Hedging Impermanent Loss
  • Mechanics - Deeper Look
    • Option Pricing Mechanics
    • Fees
    • Volatility Updates
    • Slippage
  • Tech docs
    • Mainnet addresses
    • Smart Contract Architecture
    • Deprecated Smart Contract v1 Endpoints
    • Smart Contract v2 Endpoints
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  1. Mechanics - Deeper Look

Slippage

There is a delay between user observed price and actual trade price. Where first one is an observation of the current state of the market by the user and the other is price of the trade that the user did based on its initial observation.

To make sure that the used does not receive bad (worse than expected) price we will use slippage parameter that will protect the user. The user will provide price that he/she is willing to trade at and maximum deviation from that price (slippage). If the final price is outside of this deviation then the trade does not happen.

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Last updated 2 years ago