Sigmadex is strategically engineered to solve liquidity issues that plague the current crypto asset landscape by combining Polkadot, Game Theory, Community Governance, and Transparency. By putting all these components together, Sigmadex differentiates itself from other traditional protocols, delivering multiple DeFi elements which are constructed to provide maximum liquidity and transparency.
The use of Sigmadex core DeFi and game theory pieces open up a door to new never seen before data sets. These modules further assist in making systematic trading decisions through additional insights and sentiment. Auxiliary data will further bring clarity to the public helping buyers and sellers make market judgements using layers not found in other protocols.
When users are empowered by reliable and useful data, more confidence can emerge within the markets that everyone can benefit from.
Comparison to Traditional Liquidity Protocols
Current liquidity protocols lack sufficient incentives for providing adequate liquidity. Locking up large amounts of capital is primarily incentivized by a single component – transaction fees, which in many cases is not a worthwhile or lasting incentive for individuals to inject long term liquidity, further perpetuating the issues we see today.
Sigmadex stands alone in providing valuable liquidity incentives that result in more than just earning transaction fees. By combining multiple DeFi segments such as:
- Deflationary monetary policy
- Time locked rewards
- Validator incentives
- Bonding rewards
- Distribution theory
Protocol users are given the opportunity to grow their capital in a way that is innovative yet simple to follow.
Sigmadex provides transparent insights on all data which is available by showcasing data in its user experience. These overall metrics are not limited to:
- Average stake duration across the protocol
- Amount of contracts which have matured successfully
- Total liquidity locked
- Total penalties incurred
- Rewards paid out
- Restake rate
The Sigmadex heat map is a purposely designed component to help interpret the overall health of an asset from a glance through easy to read indicator shades of green fading to red.
Each indicator represents the activity surrounding a selected asset on Sigmadex. Factors that affect the change in color indication are expiring contracts and newly time locked liquidity contracts opened.
Green - Indicates that more liquidity has been injected and locked into the asset, over trumping penalties.
Yellow to Orange - Indicates the middle ground in between liquidity injection and contract maturity.
Red - Indicates lots of contracts are about to complete their lockup cycle and maturing on this day.
Restaking for Higher Rewards
Maturing contracts do not always mean liquidity will be removed from the asset pool. There are several ways to interpret this data as incentives are put in place for people to restake their contract and take advantage of the
interestMutiplier function providing an even higher reward rate for continuing to provide liquidity. The variable for multiplier is voted upon the community and enables everyone who follows the protocol rules to earn an even bigger interest rate by restaking a matured contract.
Penalties can be interpreted in multiple ways. One common interpretation is its symbolization of fear within the asset. A high amount of penalties could be viewed as faith being lost in the product.
The incentives for liquidity providers don't stop with an interest rate that grows over time. Through the Sigmadex Penalty Pool, users who respect the protocol policies receive a portion of the penalty pool (relative to their stake) when they call the
restake function after their contract has matured.
When a user prematurely ends their contract they incur a penalty. This penalty is taken from the overall amount initially staked and is determined by how many days the contract was ended prematurely. Once this amount is determined, it is added to the penalty pool which is publicly viewable.
Sigmadex is not only a community governed decentralized liquidity protocol. It's a data source for measuring real liquidity in the market and powered by game theory allowing a well balanced economy to be conceived without a central power.