ALP Fees

To encourage the use of different assets for minting ALP, fees are adjusted according to the target weights and current weights of assets in the ALP liquidity pool. We aim to encourage asset composition of the pool to reflect the target weights.

Minting fee:

Basic Rate Parameter 1: FeeBasisPoints, USDT is currently set at 0.25%

Basic Rate Parameter 2: TaxBasisPoints, USDT is currently set at 0.05%

The current asset value: InitialValue=AssetValueInPool+AssetUnrealizedpnl_usd

The current asset value after minting: AfterMinValue=InitialValue+MinValue

Calculating the asset value according to the target weight: TargetValue=(Total Value_usd+totalUnrealizedpnl_Usd)*Target weight，Total Value=sum(InitialValue)

The current asset value and the target value (absolute value): InitialDiff=InitialValue-TargetValue

After Minting, the asset value and target mechanism (absolute value): AfterDiff=AfterMintValue-TargetValue

• if AfterDiff<InitialDiffValue

MintFee=Max(FeeBasisPoints-TaxBasisPoints*InitialDiff/TargetValue，0)

• if AfterDiff>=InitialDiff

MintFee=FeeBasisPoints+TaxBasisPoints*Min((InitialDiff+AfterDiff)/2,TargetValue)/TargetValue

Burning fee:

Basic Rate Parameter 1: FeeBasisPoints，USDT is currently set at 0.25%

Max Base Rate Parameter 2: TaxBasisPoints，USDT is currently set at 0.05%

The current asset value: InitialValue=AssetValueInPool+AssetUnreliazedpnl_usd

The current asset value after Burn: AfterMaxValue=InitialValue-MinValue

Calculating the Asset value according to the target weight: TargetValue=Total Value*Target weight

The current asset value and target value (absolute value): InitialDiff=InitialValue-TargetValue

After Burn, the asset value and target mechanism (absolute value): AfterMaxDiff=AfterBurnValue-TargetValue

• if AfterDiff<InitialDiffValue

BurnFee=Max(FeeBasisPoints-MTaxBasisPoints*InitialDiff/TargetValue，0)

• if AfterDiff>=InitialDiff

BurnFee=FeeBasisPoints+TaxBasisPoints*Min((InitialDiff+AfterDiff)/2,TargetValue)/TargetValue

For example:

If the value of the ALP pool is $10,000,000, the unrealized PnL is $+10,000, the value of BTC in the liquidity pool is $1,000;

The BTC target weight is 2%, and the current weight is 0.01%. The base rate parameter 1 of BTC is 0.25%, and the base rate parameter 2 is 0.45%.

According to the calculation, the rate of minting ALP with 1 BTC at this time is 0% = 0 BTC. The transaction fee for burning ALP to get 1 BTC is 0.7% = 0.007BTC.

Click here to view the composition of the ALP liquidity pool, the tokens’ quantities and values, target weights and current weights, as well as other information.

After selecting the asset, quantity and clicking [Mint ALP] or [Burn ALP], the webpage will display the transaction fees. Example: