Partitioned LP Depth Sectors

Long LP

In Chromatic Protocol’s LP, based on the index price in the center, the right side is the long LP that accepts the takers’ long position. Makers can provide liquidity in the bins of their choice, offering liquidity at their desired fee rates. Takers can then utilize this liquidity to open long positions. And the makers earn fees on the liquidity the takers utilize based on the fee rate of each liquidity bin.

Long LP is partitioned into four depth sectors. Each sector has nine liquidity bins, totaling 36 bins in one pool. Each bin within these depth sectors has its unique fee rate, representing the relative price distance from the index price and determining the fees charged for trading.

Short LP

In Chromatic Protocol's LP, based on the index price in the center, the left side is the short LP that accepts the takers' short positions. Similar to the long LP, makers can provide liquidity in the bins of their choice, offering liquidity at their preferred fee rates. Takers can utilize this liquidity to open short positions, and makers earn fees on the utilized liquidity based on the fee rate of each liquidity bin.

The short LP is also partitioned into four depth sectors, with nine liquidity bins in each sector, resulting in a total of 36 bins within the pool. Just like the long LP, each bin within these depth sectors has a unique fee rate, representing the relative price distance from the index price and determining the fees charged for trading.