With Tribe3 NFT perpetual futures, you can bet on floor prices both ways using leverage for a fraction of the transaction fee in any volume.
NFT perpetual futures DEX
Main features
- Trade. Use Tribe3 for long/short NFT/RWA futures with leverage of any amount.
- Social Profile. Create your own profile and brand yourself by showcasing your trading results.
- System stability. Price fluctuations within one block are limited to 3%. In case the price has already increased/decreased by more than 3% within one block, users will not be allowed to make transactions until the next block.
- Funding payments incentivize users to make transactions that bring the futures price closer to the Oracle price.
Hybrid AMM and order book system
The Tribe3 trading platform is powered by a hybrid system that combines the liquidity of an AMM and an order book. All orders are traded with AMM and/or the order book, depending on which liquidity source offers the best execution price. The hybrid approach combines the advantages of AMM and order book, allowing the system to provide smooth and efficient trading while minimizing the price impact of each trade.
Overview and flow
The user's trade interacts with the following components:
- A non-custodial deposit account that allows for flexible order execution
- An AMM that operates on a constant product formula x*y=k
- An order book where limit orders are stored, which acts as a more scalable source of liquidity that reduces the impact of each trade on price
- User deposits funds into a Tribe3 deposit account
- User uses the funds in the deposit account to open a position, specifying the amount of collateral and leverage to be applied
- The system generates an order, routing it through the AMM and order book at the best possible price
- The system sends the collateral (e.g. ETH, USDC) to the vault
- The system executes the trade by updating the AMM and matching orders.
- System updates user positions
Price Oracle
Tribe3 has implemented a proprietary oracle design that uses the average bid price (best bid for a collection) and ask (lowest price on the exchange) as the underlying data, with a dynamic TWAP period.
Using the average bid and ask price is similar to determining price by looking at the order book trading system. To further reduce the risk of manipulation, TWAP from the average price will be used, and the TWAP period will be determined by market activity/volatility.
To meet the needs of the NFT perpetual futures protocol, a balance must be struck between managing manipulation risk and ensuring market tracking speed (so that liquidation occurs in a timely manner).
To achieve a dynamic TWAP period, a baseline level of activity during the lookback period is established and compared to the actual number of trades that occurred during the comparison period. If the actual market activity level is higher than the baseline activity level, the TWAP period is reduced from the baseline TWAP period to make the oracle more sensitive. If the actual level of market activity is lower than the normal level of activity, the TWAP period is increased from the base TWAP period to make the oracle less sensitive.
NFT transaction data
Similar to the receipt of floor price and best offer data, NFT transaction data is sourced from the major NFT trading marketplaces / aggregators. Some transactions such as wash trades and private sales of NFTs are excluded.
Insurance fund
The insurance fund is designed to protect and maintain the solvency of the protocol by absorbing any unexpected losses, especially those that arise during the liquidation process.
When the market becomes very volatile, it is likely that positions will go bankrupt before they can be liquidated. This means that the remaining collateral of the position is insufficient to cover the liquidation penalty to the insurance fund and the liquidators, resulting in a bad debt that will later be covered by the insurance fund.
Each trading pair has its own separate insurance fund, which accumulates over time as the protocol accrues profits to the insurance fund.
