💧 QLP Pool

QLP is QuickPerps' Liquidity Provider (LP) token that helps power the decentralized Perpetual Exchange.

Overview

QLP consists of an index of assets used for swaps and leverage trading. It can be minted using any index asset and burnt to redeem any index asset. The price for minting and redemption is calculated based on (the total worth of assets in the index including profits and losses of open positions) / (QLP supply).

• As QLP holders provide liquidity for leverage trading, they will make a profit when leverage traders make a loss and vice versa. Past PnL data and other stats can be viewed on the Analytics Page

• LPs also receive weekly airdrops in QUICK & USDC, in addition to claimable ETH rewards every Friday

Minting and Redeeming

QLP can be minted and redeemed by heading to the 'Liquidity' section:

Once there, you will see a recap of all $QLP information:

• Price

• Your wallet holdings

• APR %

• Total $QLP supply

On the right side of the Liquidity page you will see two options: 'Add Liquidity' and 'Withdraw Liquidity'.

In Zone 1 below you can choose to mint (Add Liquidity) or redeem (Withdraw Liquidity) QLP.

You can choose any index asset to spend or redeem in using either the button in Zone 2 or any of the blue buttons (+Liquidity with X Asset) in Zone 3.

Having chosen the desired asset to provide liquidity with, enter an amount in order to see the fees required in Zone 4.

The price for minting and redeeming is calculated based on the total value of assets in the index, including the profits and losses of opened positions divided by the QLP supply.

Being able to provide or redeem the assets that are the most, or less sought after by the protocol, will allow you to lower your fees.

Please note that providing liquidity (minting QLP) immediately starts accruing rewards.

Rebalancing

The fees to mint or redeem QLP can vary based on whether the action is aligned with the protocol’s needs at that time or not.

For example, if the index has a large percentage of ETH and a small percentage of USDC, actions that further increase the amount of ETH in the index, will have a higher fee.

On the contrary, actions which reduce the amount of ETH in the index, will as a result have a lower fee.

The token weights can be seen on the Dashboard

Token weights are adjusted to help hedge QLP holders, based on the open positions of traders.

As an example, if a lot of traders are longing for the asset ETH, then ETH would have a higher token weight. However, if many traders are shorting, then a higher token weight will be given to Stable-coins.

If the prices of tokens are increasing, then the price of QLP will increase as well, even if a lot of traders have opened a long position on the platform.

The portion reserved for long positions can be treated as stable in terms of its USD value. Since, if prices increase, the profits from that portion will be used to pay traders. On the other side, if prices are decreasing, the losses of traders will keep the USD value of the reserved portion the same.