The world of decentralized finance (DeFi) is constantly evolving, with new projects and technologies emerging on a regular basis. One such project that has been causing a stir in the DeFi community is a new protocol that introduces a revolutionary new way to trade cryptocurrencies. This project, known as “Carbon” is set to shake up the DeFi landscape by introducing a unique approach to on-chain trading that is both innovative and highly effective. In this article, we will take a closer look at Carbon and explore how its unique features could change the way we think about trading.
INTRODUCTION
CARBON is an advanced on-chain trading protocol enabling automated, adjustable trading strategies with custom ranges, linked orders & continuous one-directional liquidity. With Carbon you get seamless Range Order creation, Disposable Strategies and Recurring Strategies, Linked Orders and Rotating Liquidity. Let’s see what these mean for traders.
Carbon is designed to automate on-chain trading strategies in a fully decentralized manner. The protocol is built on Ethereum blockchain, making it secure and transparent.
Carbon allows traders to automate their trading strategies without the need for intermediaries or centralized exchanges. By eliminating intermediaries, Carbon enables traders to reduce fees and achieve faster trade execution times. Moreover, the decentralized nature of Carbon ensures that users have complete control over their funds.
FEATURES OF CARBON DEFI
Decentralized: Carbon is fully decentralized, which means there are no intermediaries involved in the trading process. This ensures complete control over your funds and reduces the risk of fraud or manipulation.
Customizable strategies: The protocol is flexible, allowing traders to create and deploy custom strategies that can be executed in only specific price ranges, automatically, and adjustable on the fly.
Hybrid order book system: Carbon’s unique hybrid order book system does not use oracles or keepers, but instead uses native on-chain order book matching ensuring fast and efficient trade execution.
Secure: Built on top of the Ethereum blockchain, Carbon benefits from the security and decentralization of the Ethereum network.
Transparent: Carbon’s smart contract system ensures that all trades are executed in a fair and transparent manner, with no hidden fees or charges.
Scalable: Carbon is designed to handle large volumes of trades without compromising on speed or security, making it a powerful tool for traders of all sizes.
Low fees: By eliminating intermediaries and using a decentralized system, Carbon offers low fees for traders, making it an affordable and accessible protocol for everyone.
WHAT MAKES CARBON UNIQUE
Seamless Range Order Creation
The process of creating a range using limit orders on a traditional order book system involves several factors that traders must consider. These include the number of orders to be created, the amount of liquidity to be allocated to each order, the initial investment, and the expected return on investment. While this method is effective for scaling in or out of a position, it is also tedious and time-consuming. With Carbon, you simply set the same custom price range with two fields, fund one or both orders, and you are done.
Rotating Liquidity
When a trader is using a traditional order book system, they must wait for their sell order, for example, to fill in order to create a buy order using that same liquidity. On Carbon this is not the case. The buy and sell orders, limit and/or range, are linked, and therefore draw on a single source of liquidity. This liquidity automatically shifts into the opposite side of the strategy as each order is filled.
Carbon Strategy Types
Disposable Strategies
If your only intention is to accumulate at a specific price or within a specific range, or to scale out of a position for example, then your single order is the extent of your trading strategy. On Carbon, this is referred to as a “disposable strategy”, meaning it is meant for one-time use only. Disposable strategies may be made up of either a buy order or a sell order, limit or range. Disposable strategies are perfect for trading in and out of a position.
Recurring Strategies
Recurring Strategies are when a buy order and sell order are linked together. Liquidity rotates between the two linked orders, creating an automated "buy low, sell high" trading strategy. For example, if ETH is acquired in a buy order, that ETH will automatically fund the linked sell order. Once the price of ETH is within the custom parameters of the sell order, it will be traded, with the newly acquired USDT automatically funding the linked buy order. So long as a trader chooses to keep this strategy active, this automated buying low and selling high will continue. Due to this continuous behavior, it is referred to as a "recurring strategy".
Asymmetric Liquidity
Asymmetric Liquidity offers a radically new trading paradigm — one of on-chain liquidity where users execute personalized trading and market-making strategies. A defining characteristic of these strategies is their asymmetry: Whereas a conventional liquidity position uses a single bonding curve for both buying and selling, Asymmetric Liquidity allows for the creation of individual user strategies composed of two bonding curves, where each curve executes irreversible trades. In practice, this gives users the ability to create automated trading strategies composed of one or two on-chain limit or range orders for any given token pair, with each order represented by a unique, adjustable bonding curve.
Operating Mechanism
Carbon works by leveraging blockchain technology to create a fully decentralized protocol automating on-chain trading strategies. Adjustable Bonding Curves (ABCs) are the result of a unique invariant function, unique to Carbon and at the core of the Carbon design. The pricing algorithm of each curve depends on the balance of only a single token, rather than two or more tokens. Each curve executes orders in one direction, irreversibly, and can be updated in a highly gas-efficient manner. Each strategy consists of two independent ABC’s, defined by three constants and a single token balance. The strategy consists of a total of three slots in memory. Active users may adjust their strategies on the fly without requiring complex interactions with a set of supporting smart contracts.
Carbon provides a powerful and innovative protocol for automating on-chain trading strategies. Its unique features make it an attractive option for traders looking for customization, greater control, and transparency in their trades.
WHY USE CARBON
1: Carbon is a feature-rich, fully decentralized protocol governed by the BancorDAO.
2: Traders can create and deploy custom trading strategies that are executed automatically and continuously with linked orders and rotating liquidity.
3: Carbon offers low fees for traders, making it an affordable and accessible protocol.
4: Carbon’s unique hybrid order book system eliminates the risk of sandwich attacks and reversible trades.
5: Carbon enables traders to create true ranges with adjustable parameters, something not available elsewhere.
6: Carbon supports all standard ERC-20 tokens, allowing any user to create trading strategies for any standard ERC-20 token pair. Moreover, as Carbon can be deployed on other blockchains, it will undoubtedly support other token standards in the future, thereby increasing its flexibility and versatility.
Conclusion
In conclusion, Carbon offers a powerful and innovative protocol for traders looking to automate their on-chain trading strategies. Its decentralized architecture, customizable strategies, and low fees make it an attractive option for traders of all sizes. By leveraging blockchain technology, Carbon provides a secure, transparent, and customizable platform that enables traders to execute trades automatically, without the need for intermediaries or centralized exchanges.
If you are a trader looking for greater control over your trades and the ability to create a custom strategy, then Carbon may be the perfect solution for you. With its unique hybrid order book system and flexible strategy automation tools, Carbon offers a powerful and customizable protocol that can help you optimize your trading strategies and achieve your financial goals. So why not give Carbon a try and experience the benefits of innovation and automation in trading for yourself?
For additional information on Carbon visit the following:
Website: CarbonDeFi.xyz
Follow Carbon on Twitter
Subscribe to the Carbon Medium
Join the Carbon community on Telegram and Discord
Read the Litepaper, Whitepaper Summary, and Patent Filing
