Fees & Costs
The OmniTrade platform makes use of a simple and transparent fee structure to reward the liquidity providers that support the platform. There are four basic fees used by the protocol:
Fees
Open Fee: is the fee that is applied to open a position and is equal to 0.1% of the Position Size.
Close Fee: is the fee that is applied to close a position and is equal to 0.1% of the Position Size.
Borrow Fees: Leveraged trading involves the user borrowing funds from the protocol for the duration of the trade. These funds are provided by the protocol liquidity providers via the OLP. In return for the loan of the assets a transaction borrow fee is charged. This fee is calculated as :
Swap Fee: is the fee that is applied to swap from one token to another and is between 0.2% and 0.8% depending whether the swap improves or reduces the OLP Target Ratios for the tokens involved in the swap
Transaction Costs (Gas)
When opening, closing or editing a position there are two, separate blockchain actions that are required.
First, the user sends a transaction to request the open position, close position, deposit collateral or withdraw collateral
Then the Keepers observe the blockchain for these requests and then execute them
The cost of the second transaction is displayed in the confirmation box as the "Execution Fee" and is the gas paid to the network for the second transaction.
Price Spreads
OmniTrade uses zero spread trading technology so that users can execute large trades at the exact Market Price (Mark). This means that there is no inherent slippage for trades or swaps. However, during times of high volatility there may be some variation between the market prices reported by the reference price feeds and in these situations long positions will be opened at the higher of the reported prices and closed at the lower price while short positions will be opened at the lower of the reported prices and closed at the higher price.
Transaction Times
On some occasions there may be a short lag between when a transaction is submitted and when it is confirmed on the blockchain. If as a result of volatility the Market price changes during this period then the actual execution price may vary from the transaction Mark price. Users can configure the default maximum slippage size in their user settings, and if the slippage exceeds this value then the transaction will be cancelled and funds will be returned to the user.
Stablecoin Pricing
The current price of all tokens, including stablecoins are continuously tracked using the system price feeds. As with other tokens, all transactions involving stablecoins are executed using the current Market Price (Mark). As a result of this if a stablecoin depegs then a spread will occur for that coin resulting in the following actions:
Opening and closing short positions when a stablecoin is not at its pegged price will reduce the value of the collateral deposited based on a spread of 1 USD to the current Market Price. For example, if the price of the stablecoin depegs to 0.95 USD, opening a position using 1000 of that stablecoin would result in a position collateral of 950 USD. When closing the same position, 950 of the stablecoin would be withdrawn based on a price of 1 USD, this is to prevent front-running issues during a depeg since collateral is stored as a USD value and converted to tokens based on the latest price.
Similar to other tokens, if a spread occurs in the price of the stablecoin then, to ensure that profits for all short positions can always be fully paid out, the protocol will pay profits in the stablecoin based on a high price of the spread. This high price will be either 1 USD or the current current Market Price (Mark) for the stablecoin, whichever is higher.
For swaps using the depegged stablecoin, the spread from 1 USD to the current Market Price of the stablecoin will similarly apply.
Long positions are not directly effected by the depegging of stablecoins however a spread will apply to any collateral swaps that are required to open a position if they involve the depegged stablecoin.
Last updated
