Our Thesis
VCRED's approach to marketmaking
Last updated
VCRED's approach to marketmaking
Last updated
VCRED operates at the intersection of AMMs and traditional market makers. Our smart Market Maker provides the best of both worlds, with a user experience similar to AMMs while enabling asymmetric exposure to long-tail assets with a more transparent view of the algorithmic marketmaking process.
To achieve this, we initially integrated with major CLOBs and used our institutional-grade backend to assimilate data on blue-chip tokens and finetune our strategies. We use a set of alpha factors, including trading indicators, to form a factory pattern daily, selecting the best features based on a set of robust statistical testing procedures. When LPs stake their assets on VCRED's vaults via a pool manager contract, VCRED's trader contracts interface with its AI or statistical engine to estimate the best alpha factors from the previous time window to execute the trade or long/short and provide liquidity for long-tail assets while delivering an asymmetric return.