Bancor's new trading protocol, Carbon, gives users greater control over their liquidity to execute novel trading strategies on-chain.
It’s go time! Carbon has been deployed to the Ethereum mainnet!
- Check out the carbondefi.xyz app.
- Access the open-source Carbon smart contracts and SDK.
Carbon equips users with brand new ways to trade in DeFi while supporting on-chain, decentralized liquidity for the token economy.
- With Carbon, users can create automated trading strategies using custom on-chain limit orders and range orders.
- A user can submit an individual order or combine their orders together to create a recurring strategy that buys in one price range and sells in a separate price range, on repeat.
- As the market price moves into selected ranges, orders are executed by spot traders who interact with Carbon directly, via DEX aggregators, or as arbitrageurs.
No more self-reversing liquidity, complex liquidity management tools, and MEV bots feasting on trades. By design, Carbon liquidity trades in a single direction. As a result, orders are irreversible on execution, easily adjustable directly on-chain, and natively resistant to MEV sandwich attacks. All with no reliance on oracles or keepers.
For instructions on creating a Carbon strategy for any standard ERC20 token, see the Strategy Guide.
From XYK to Asymmetry: A Brief History of On-Chain Liquidity
Carbon marks a new era for on-chain trading and liquidity.
The first generation of on-chain liquidity — supported by constant-product AMMs — required liquidity providers to buy and sell tokens across an infinite number of prices.
The introduction of concentrated liquidity gave liquidity providers the ability to set a specific range of prices where they offer to buy and sell tokens.
Carbon is the first protocol to offer “asymmetric liquidity”, whereby users can distinguish between their buy and sell ranges. Ranges can be placed above and below a set price based on where a user expects a given token will trade — automating the process of “swing trading” any standard ERC20 token.
Take Control of Your Liquidity
Carbon gives users greater control over their liquidity to execute novel trading strategies on-chain.
Some examples:
- Trade a crabby ETH market with an ETH/USDC strategy that buys ETH between $1800 and $1900 and sells ETH between $2100 and $2200. Fund the strategy with USDC only.
- Trade a “bullish token unlock” with a strategy that buys the dip leading up to the unlock, and sells when the token rises.
- Arb pegged assets — e.g., with an ETH/rETH strategy that buys ETH when it de-pegs below the price of rETH, and sells the ETH when it re-pegs to the price of rETH.
By design, Carbon strategies are:
- Composable: Users can submit individual orders or combine their orders to create recurring strategies that buy a token low and sell it high in distinct price ranges, in perpetuity, using a single source of liquidity that automatically rotates between orders.
- Irreversible: Unlike existing on-chain liquidity protocols where users must manually monitor and withdraw their liquidity upon execution in order to finalize a limit or range order, Carbon orders trade in one direction and are final upon execution, eliminating the risk of order reversal.
- Adjustable: Strategy updates can be made in a highly gas efficient manner, without needing to withdraw and re-add liquidity, via adjustable parameters exposed in each strategy.
- MEV Resistant: Spot trading is completely resistant to the most common form of Maximum Extractable Value (MEV), sandwich attacks.
Other resources:
- Technical docs
- Whitepaper
- Litepaper
- Smart contract audits: here and here
- Carbon Explainer Video
To get involved and stay up to date:
- Join the Carbon community on Telegram or Discord
- Follow Carbon on Twitter
- Subscribe to our Youtube
- Subscribe to the Carbon blog
- Participate in BancorDAO governance