Algebra

It can be referred to as Algebra ‘Integral’.Our architecture enables decentralized exchanges to strike a balance between computation cost and functionality. Different networks have varying gas costs, with some prioritizing advanced features, while others, like Ethereum, incurring significant swap fees for additional computations. For that, our modular architecture empowers DEXs to update and integrate new plugins without the need for liquidity migration, allowing them to adapt to evolving DeFi requirements and trends. Read on to learn how it all works.<h2 id="header-0">TR:DL</h2>The new version of Algebra, Algebra ‘Integral’, introduces a higher level of flexibility for partners and users of the protocol. It serves as an engine for DEXs, finding the perfect balance between gas costs and functionality. The modular architecture allows for the inclusion or exclusion of specific modules, enabling seamless management of components without the need for liquidity migration.<ul><li>The new modular structure allows for the disabling, switching on, or upgrading of individual plugins without wasting gas and optimizing efficiency. This means that plugin updates can be performed without the necessity of withdrawing liquidity from the platform, reducing disruptions for users.</li><li>Gas costs can be significantly reduced thanks to the implementation of the modular architecture.</li><li>With Algebra ‘Integral’, the functionality of decentralized exchanges expands, providing DEX teams with the opportunity to enhance their platforms by integrating new implementations easily. This empowers them to adapt to the evolving needs of the market and offer a more comprehensive and competitive trading experience.</li><li>By moving all secondary functionalities into plugins, the core of the protocol becomes smaller and simpler. This results in easier testing, auditing, and verification processes. Ultimately, it enhances the security of a critical component for DEX operations.</li></ul>Thus, the modular structure enhances the security of decentralized exchanges, providing a safer environment for LPs, farmers, traders, and other participants. It ensures that their assets and transactions are better protected.Mitigating the Liquidity Migration &amp; Simplifying the Update ProcessDEX protocols often face challenges when it comes to updating their infrastructure. To maintain security and decentralization, a significant portion of the protocol remains immutable, leading to the need for liquidity migration with each new version. This process is complex and hinders the implementation of new ideas. At the same time, the DeFi landscape is highly dynamic, with all the new protocols, trends, and algorithms emerging daily, offering potential enhancements to existing exchanges.That’s where Algebra ‘Integral’ enters the game, with its brand-new modular architecture, aimed at creating a more cost-effective, customizable DEX, targeting at the ultimate security thanks to this approach.The goal of Algebra Protocol ‘Integral’ is to address multiple challenges by developing a modular architecture for DEXs, consisting of adjustable, customizable plugins. The DAO of the DEX will be responsible for configuring and connecting these modules, or plugins, with the option to prohibit any changes if necessary.<h2 id="header-1">One Pool for Each Pair</h2>Traditionally, Algebra allows creating only one pool for each token pair, with the commissions, or fees, being regulated by the dynamic fee plugin.In Algebra, a single pool is established for each pair of tokens. This approach minimizes liquidity fragmentation, making it simpler for users to decide where to allocate their liquidity and enabling routers and aggregators to identify optimal swap routes more efficiently.Algebra continues to adhere to this approach, which was quite successful in the previous protocol versions.<img src="https://miro.medium.com/v2/resize:fit:1400/0*ujfLK2QmWe6eJRMu" />The Plugin System<h2 id="header-2">Introducing Interchangeable Plugins</h2>Schematically, the Algebra architecture for a specific pair can be represented as a pool, which is a crucial part that stores the pair’s liquidity and implements the swap logic. In addition, there are exchangeable modules, known as plugins, that interact with the pool.The Algebra ‘Integral’ architecture offers extensive customization options for the logic of all protocol pools, including individual pools. Plugins play an important role in this customization.Each pool can be connected to a smart contract that aligns with the plugin specification for the Algebra Protocol. By utilizing hooks (calls from a pool before or after specific actions), a plugin can extend, enhance, or modify the standard behavior of liquidity pools.<img src="https://miro.medium.com/v2/resize:fit:1400/0*u29tN6678_AX1A2e" />On the other hand, it is also possible to operate without any plugins, creating a pure AMM without unnecessary functionality from the protocol. This flexibility allows for easy adaptation to external requirements and enables maximum gas savings by disabling secondary logic when not needed.<img src="https://miro.medium.com/v2/resize:fit:1400/0*5Z4D9tc91No9iKpp" />The protocol has the capability to replace plugins for pools at any time, allowing for continuous development and the addition of functionality based on user or partner needs. As a result, Algebra AMM can be configured in various ways to accommodate specific market or environmental requirements. However, it maintains a solid and proven core of concentrated liquidity logic that remains consistent across different configurations.<h2 id="header-3">Standard Plugin</h2>As part of the default offering, the Algebra team provides a standard plugin that offers the following functionalities:<ol><li>TWAP-oracle (Time-weighted average oracle): This oracle provides average statistical information about the price of a specific token pair, making it easy to access.</li><li>Volatility-oracle: Utilizing data from the TWAP-oracle, the plugin efficiently calculates the daily volatility of the price in a token pair.</li><li>Dynamic fee: Taking into account the daily price volatility, the plugin automatically adjusts the commission values within the pool to better align with changing market conditions.</li><li>On-chain farmings: This plugin enables the effective utilization of farmings for concentrated liquidity purposes.</li></ol>These features are provided by default to enhance the functionality and performance of the Algebra DEX Engine.<h2 id="header-4">Conclusion</h2>Algebra Protocol ‘Integral’ introduces a modular architecture that addresses the difficulties faced by existing decentralized exchanges. Its flexibility, security, and efficiency are designed to meet the evolving needs of the DeFi ecosystem. By enabling the replacement or supplementation of functionality without the requirement for liquidity migration, the protocol provides a streamlined approach to protocol upgrades and integration of new features. With its versatile plugin system and a range of standard plugins, Algebra ‘Integral’ empowers users and partners to adapt to market demands, enhancing the overall trading experience in decentralized exchanges.About AlgebraAlgebra is a Protocol allowing projects to implement the Concentrated Liquidity tech, along with other groundbreaking features. Already integrated into Camelot, THENA, QuickSwap, StellaSwap, Zyberswap, SpiritSwap, Ubeswap, Glacier, Équilibre, Nomiswap, SkullSwap, and more DEXs on different chains, Algebra helps them acquire higher volume &amp; raise capital efficiency. Learn more on our website: <a href="https://algebra.finance/" rel="noopener noreferrer nofollow">algebra.finance</a>.$ALGB is the platform token of the Algebra Protocol, which can be staked, and used for governance, liquidity provision, and much more. The Algebra stakers get part of all fees acquired from the integrated DEXs in ALGB, while part of the commissions is used for buybacks, which strengthens the token itself. <a href="https://coinmarketcap.com/currencies/algebra/" rel="noopener noreferrer nofollow">ALGB on CoinMarketCap</a>.<a href="https://t.me/cryptoalgebra_chat" rel="noopener noreferrer nofollow">Telegram</a> |<a href="https://twitter.com/CryptoAlgebra" rel="noopener noreferrer nofollow"> Twitter</a> | <a href="https://discord.gg/afkggeMMDC" rel="noopener noreferrer nofollow">Discord</a> | <a href="https://www.youtube.com/channel/UCCeQt4pAAQ-DDdRAEF2hwhQ" rel="noopener noreferrer nofollow">YouTube</a>

Algebra Integral: Empowering Decentralized Exchanges with Modular Architecture's Core & Plugins

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Algebra DEX Engine

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