Possibilities of Limit orders

The combination of customizable liquidity positions, single-sided asset provisioning, and borrowing enables the creation of limit orders, referred to as Bin Orders.

Bin Order in the Form of Liquidity Provisioning

• Take Profit / Sell Limit Order

• Buy Limit Order

These orders enable users to provide a single asset as liquidity within specific price bins, with the expectation that the order will be executed when market prices align with the bin.

Benefits:

• Opportunity to generate fees from liquidity provisioning while awaiting execution.

Challenges:

• Orders may remain unfilled if market prices move out of range and reverse before the liquidity is removed.

Examples:

• Take Profit/Sell Limit Order: If the current price of a USDC/NAD pool is 1,900 USDC/NAD, and you aim to sell NAD for USDC when the price reaches 2,000 USDC/NAD, you can provide NAD at 2,000 USDC/NAD. The order will be filled when the spot price crosses your specified bin.

• Buy Limit Order: If the current price of a USDC/NAD pool is 2,000 USDC/NAD, and you expect NAD to rebound after dropping to 1,900 USDC/NAD, you can provide USDC at 1,900 USDC/NAD. The USDC will be swapped for NAD when the spot price drops below 1,900 USDC/NAD.

Bin Order in the Form of Borrowing

• Buy-Stop Order

• Stop-Loss / Sell Stop Order

How It Works:

• Users can collateralize assets to borrow at specified bin prices either above (buy-stop order) or below (stop-loss order) the active price bin.

• Upon execution, users receive the borrowed asset immediately.

• Borrowed positions can be closed by repaying the debt and reclaiming the collateral before the debt expiration.

Benefits:

• Eliminates manual monitoring, as orders execute instantly when liquidity is available at the specified price bin.

Challenges:

• Execution depends on the availability of liquidity in the chosen bin.

• Borrowing fees apply to filled orders.

Examples:

• Buy Stop Order: If the current price of a USDC/NAD pool is 1,900 USDC/NAD, and you anticipate that the price of NAD will rise to 2,000 USDC/NAD, you can collateralize USDC at a bin priced at 2,000 USDC/NAD to borrow NAD. This ensures you commit to buying NAD only after the market confirms your bullish expectation.

• Stop-Loss/Sell Stop Order: If the current price of a USDC/NAD pool is 2,000 USDC/NAD, and you expect NAD's price to drop below 1,900 USDC/NAD, you can collateralize NAD at 1,900 USDC/NAD to borrow USDC. This mitigates your downside risk by locking in a sell action at 1,900 USDC/NAD before further price declines.