Voltage v3: Revolutionizing Liquidity Provision in DeFi

Fuse Network is delighted to announce the launch of its leading DEX’s latest iteration, Voltage v3, emphasizing its pioneering feature: concentrated liquidity. Voltage v3 sets a new standard, offering an intuitive interface, enhanced rewards, and unparalleled capital efficiency.

Voltage v3 introduces concentrated liquidity, a monumental departure from the uniform liquidity distribution observed in earlier iterations. This new feature empowers liquidity providers to allocate their capital within specific price ranges, thereby augmenting capital efficiency, especially in stablecoin pairs characterized by relatively stable prices.

What you need to know

• Fuse Network unveils Voltage v3, featuring concentrated liquidity with an intuitive interface and enhanced rewards.
• Voltage v3 introduces concentrated liquidity, empowering LPs to optimize capital efficiency within specific price ranges.
• Liquidity becomes ‘active’ within set price ranges, enabling fee generation and flexibility for LPs to optimize capital allocation.
• CL pools in Voltage v3 offer enhanced ROI opportunities, necessitating proactive management from liquidity providers.
• Voltage v3 implements a revamped fee structure to ensure equitable distribution of fees to LPs and VeVOLT holders.
• Voltage will soon unleash a VOLT burning mechanism, instilling a deflationary nature into Voltage’s governance token.
• Join us for a LIVE AMA with the Voltage team on YouTube on Wednesday, February 21st.

After the initial release of the beta version of concentrated liquidity across two pools in early January 2024, Voltage introduces the complete launch of Voltage v3, which features:

Active Liquidity and Price Ranges

Within Voltage v3, liquidity assumes an ‘active’ state when the asset’s price resides within the LP’s designated price range, facilitating fee generation. Conversely, if the price strays beyond this range, the position transitions to inactive, ceasing to accrue fees. 

Notably, liquidity providers possess the flexibility to create multiple positions with distinct price intervals, optimizing their capital allocation in response to market dynamics.

Non-Fungible Liquidity Positions

In Voltage v3, the platform treats liquidity positions as non-fungible tokens (NFTs), endowing each with unique configurations. These NFTs symbolize ownership of underlying assets and the trading fees accrued, providing transferability and flexibility for users to redeem funds by withdrawing liquidity.

Capital Efficiency with Concentrated Liquidity Pools

Concentrated Liquidity (CL) pools herald a new era of enhanced ROI opportunities, enabling LPs to concentrate their positions around predefined price ranges. While this approach fosters superior capital efficiency compared to traditional liquidity pools, it necessitates attentive and proactive management from liquidity providers.

Technical Insights: Voltage v2 vs v3

Voltage v3 represents a quantum leap in capital-efficient trading, mitigating trading slippage through the strategic concentration of capital within the most actively traded price ranges. This optimization ensures heightened liquidity, reduced slippage, and enhanced capital preservation for traders across all fee tiers.

More Flexibility, More Choice, More Earnings

The capital efficiency inherent in Voltage v3 empowers LPs to tailor their assets to specific price ranges, culminating in a more rewarding and flexible liquidity provisioning experience. Key features include:

• Customizable Price Range: LPs can delineate narrow price ranges, typically resulting in augmented earnings, with the potential for various returns on the same capital investment.
• Flexibility of Fee Tiers: LPs can select from an array of trading fee tiers (0.01%, 0.05%, 0.3%, and 1%) when providing liquidity for identical token pairs. This flexibility enables LPs to optimize their earnings by selecting the fee tier that aligns with prevailing market conditions.
• Non-Fungible Liquidity Positions: Each liquidity position is endowed with a unique identifier based on its configurations, facilitating the creation and management of multiple positions for the same trading pair, albeit with differing configurations and liquidity volumes.

Updated Fee Structure & VOLT Burn 

Voltage v3 introduces a revamped fee structure to strengthen tokenomics and foster sustainability. The tiered fee system offers varying fee rates, catering to diverse trading preferences and market conditions while ensuring equitable distribution of fees to LPs and VeVOLT holders.

Alongside an updated fee structure, Voltage will soon unleash a VOLT burning mechanism, instilling a deflationary nature into Voltage’s governance token. Bookmark the Fuse blog and follow Voltage on Twitter to stay updated. 

Voltage v3 Liquidity Provision Tutorial

Step-by-Step Guide

1. Access Voltage Finance DEX: Navigate to the Voltage Finance platform and proceed to the ‘Pools’ tab.

2. Connect Your Wallet: Utilize the ‘Connect Wallet’ functionality to link your preferred wallet service to the platform.

3. Select the V3 Pools: Explore available v3 pools under the ‘Pools’ tab and select your desired pool, such as VOLT-WETH.

4. Deposit Your Assets: Specify the quantity of VOLT and WETH you intend to provide as liquidity, along with your preferred fee tier.

5. Set Your Price Range: Determine the price range within which your liquidity and earning fees will be active.

6. Review and Confirm: Verify all details, including deposit amounts, price range, and potential fees, before confirming the transaction.

7. Approve and Supply: Confirm the transaction in your wallet to add your liquidity to the pool and receive LP tokens representing your position.

8. Track Your Position: Monitor your active liquidity positions under the ‘My Pairs’ tab, where you can track performance, collect fees, and adjust positions as needed.

Risks and Considerations

Engaging in concentrated liquidity provision entails certain risks, notably impermanent loss and the imperative for active management. LPs should meticulously assess these factors and formulate a prudent investment strategy when participating in Voltage v3 pools.

Join us in shaping the future of decentralized finance, where your assets work harder than ever. For further inquiries or assistance, refer to our detailed documentation.