GammaSwapPrice

(GS)

GammaSwap is a decentralized protocol that allows users to "borrow liquidity" from leading Automated Market Makers (AMMs). Unlike a standard decentralized exchange, GammaSwap enables traders to effectively "go long" on volatility or hedge against Impermanent Loss. This mechanism allows users to gain exposure to the underlying volatility of asset pairs rather than simply swapping tokens, providing a unique way to profit from market movements.

Unlike many protocols that rely on external price feeds or oracles, GammaSwap utilizes the internal mathematical "K" constant of AMM pools to determine the value of positions. By basing valuations on the internal state of the pool, the protocol is resistant to oracle manipulation attacks. This approach ensures that trading and liquidations are governed by the decentralized pool's own logic rather than external data sources.

Perpetual options on GammaSwap have no expiration date and no traditional strike price. Instead, they operate using a borrowing rate system where users pay interest to keep a position open, similar to how funding rates work in perpetual futures. This allows traders to maintain exposure to volatility for as long as they wish, provided they cover the ongoing borrowing costs associated with the position.

$GS is the liquid governance token that can be traded on platforms like LBank. $esGS (Escrowed GS) is a non-transferable reward token earned through protocol participation; it can be staked for rewards or vested over 30 days to become liquid $GS. Multiplier Points (MP) are earned by long-term stakers to increase their share of protocol revenue without inflating the token supply. Unstaking $GS results in a proportional loss of accrued MPs.

The primary utility of $GS is staking, which grants holders 30% of all protocol revenue. These rewards are typically distributed in ETH or native gas tokens, alongside $esGS and Multiplier Points. Staking yields are variable and can fluctuate based on market volatility, as the protocol captures trading fees and liquidation gains. Users must manually claim their rewards and can choose to restake them to compound their earnings.

GammaSwap uses a "Time to Liquidation" model instead of traditional price-based liquidation. A position becomes liquidatable when the accumulated borrowing fees exceed the value of the collateral provided by the user. This technical design allows the protocol to manage risk based on the cost of maintaining the position over time, providing a buffer during flat market periods while ensuring the protocol remains solvent without external price feeds.