Understanding Validly

Validly's AMM can be configured to one of the following two options:

• Stable AMM: Follows the design pioneered by Solidly, allowing users to trade any two pegged assets with very low price impact, such USDC and USDT or other stablecoins, liquid staking derivatives, etc.

• Constant Product AMM: Same AMM design as UniswapV2 and its forks. It supports trading for any two assets.

By implementing the above as a Valantis Liquidity Module, we get the following advantages:

• It becomes easy to customize Validly's implementation with novel modules, including price and volatility oracles, dynamic fees that protect LPs from quoting at stale prices, access-restricted Validly pools, novel tokenomics via a Gauge Module, etc, without any code changes on the existing Validly Liquidity Module. In contrast, existing implementations are monolithic and would have to re-build the liquidity pool smart contract from scratch.

• Native support for rebase tokens, such as stETH and USDM, thanks to the Sovereign Pool's native support for these kinds of assets.

• Having a familiar AMM design which can be implemented on Valantis in a few lines of code, serving as a simple to understand example for developers wanting to integrate with or build on Valantis' Core Protocol.