Amalgam's Core Functionality - Amalgam aims to reward market makers for providing liquidity essential for liquidating unhealthy debt [3] - The system caps liquidation risk by limiting loans to the amount that can be liquidated with available reserves [3] - Amalgam charges borrowers penalties for posing risk to the system, incentivizing liquidity deposit [3] Risk Management & Liquidation - The system penalizes risk to boost yields for market makers [1] - Penalties are applied to debts oversaturating risk, rewarding market makers for supporting this risk [3] - If penalties fail, the system spreads out concentrated liquidations, moving liquidation points closer to the price [4] - This allows risk to be healed by restructuring the liquidation point of large positions [4] Market Maker Incentives - Lending protocols don't compensate market makers adequately for providing on-chain liquidity for liquidations [2] - Swap fees are minimal compared to the service on-chain liquidity provides for lending protocols [2]
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Ammalgam (δ, γ)·2025-07-25 17:20