Smart AutoBet Model

The Smart AutoBet Model is a model for automatic smart betting tradings of digital synthetic assets. Users can become traders or liquidity providers in BLEX without restrictions. Based on matching the trading model, the betting slip of the protocol must be able to issue a bill.

In this model, a variety of essential mechanisms are required to ensure the smooth operation of the trading ecology: mainly including the oracle-based price feeding model, the Funding Model for balancing market billing, and the basic billing and settlement system (Billing System).

Index Price feed Model

BLEX is a decentralized index perpetual exchange, essentially an over-the-counter(OTC) transaction. Transactions on BLEX will not directly affect market prices. The basis is a safe, fair and effective index price feeding model.

BLEX hopes to have a fair and fast third-party oracle machine that can provide high-speed refresh price feed service. Of course, the cost of this high-speed update is tremendous. Unfortunately, there is currently no perfect solution to provide this service, so we use multiple price solutions to ensure the timeliness and fairness of the current price and achieve an instant index.

• The base price is based on the feed price of the Chainlink oracle

• As we all know, the price update of Chainlink cannot be done too fast for now. If the price of Chainlink is greater than the set update time, the built-in Keeper in BLEX will correct the price based on the latest DEX and mainstream CEX

BLEX strives to provide users with trading services at the fairest index price, and the founding team will also work with industry partners to explore better solutions.

In V0.6, we will introduce the following mainstream cryptocurrency trading pairs for the market to use currently. In the future, we will continue to explore more trading markets, not just limited to assets in the cryptocurrency market.

Funding Model

In V0.6, we mainly use the funding rate and the maximum (Available Liquidity) to balance the overall market situation.

Billing System

1. Order

BLEX is committed to provide traders with customary ways of billing methods. Orders include market order, limit order, and Take Profit and Stop Loss order:

• Market order: Directly use the index market price for transactions. When trading based on market orders, there will be a time lag between the user placing an order and the execution of the transaction on the blockchain, resulting in price changes. Users can set the maximum acceptable slippage range on the web page, but when the latest price is within the slippage range, the transaction will be made at the latest oracle price

• Limit order: Orders are placed when the price set by the user is met

• Take profit and stop loss order: BLEX currently only allows you to choose a stop profit and stop loss order when closing a position

2. Margin

In BLEX, users need to trade with margin. Whether users go long or short, $USDT is used as the margin. The margin system follows an isolated mode, meaning the margin for each position is independent.

1. Opening Margin: When the user opens a position, the deposit will be invested in the position as the opening deposit. According to the size of the leverage multiple, when opening a position, the amount of margin paid will first deduct the opening fee.

2. Maintaining Margin: With the profit and loss caused by price fluctuations and the payment of funding fees, the user's margin balance will change. When the user's margin balance reaches the minimum margin requirement, the user will be forced to close the position. The minimum margin requirement is the maintenance margin, which is generally 1/2 of the initial margin.

3. Minimum Margin Limit

   • Minimum margin for opening the position: To avoid the margin for opening a position is too insufficient to cover the loss, the minimum requirement is 10 USD

   • Withdraw the minimum remaining margin: To avoid the remaining margin after withdrawal is too insufficient to cover the loss, the minimum requirement is 10 USD

   • The minimum remaining margin for closing positions: To avoid the remaining margin after closing positions is too insufficient to cover losses, the minimum requirement is 5 USD

3. Liquidation

Liquidation means forced liquidation. When the user's position reaches the maximum leverage, that is, when the margin balance reaches the maintenance margin, forced liquidation will be executed.

Liquidation conditions: margin balance ≤ maintenance margin

In addition, under extreme market conditions, the price may quickly pass through the forced liquidation price and may pass through the bankruptcy price. At this time, a liquidation may occur, that is, the user's margin is not enough to cover the loss and expenses. The protocol will automatically liquidate the position.

Liquidity Pool

The core trading relationship of BLEX is between Trader and the LP pool. Thus, BLEX needs to design a corresponding liquidity mechanism to ensure the smooth progress of the transactions.

The liquidity pool of BLEX is denominated and settled by a single stablecoin ($USDT), therefore, LP does not suffer impermanent losses in the process of providing liquidity.

In BLEX, users can add liquidity to the liquidity pool without permission, minting the ownership token $BLP of the liquidity pool to share the actual and expected benefits of the liquidity pool.

$BLP cannot circulate freely in the market, only when you invest in $USDT (that is, buy $DLP), the new $BLP will be minted.

When you withdraw $USDT (that is, when you sell $BLP), the corresponding $BLP will be burned and $BLP can also be transferred to the user's new wallet.

For $BLP minting and profit distribution details, please refer to the "Whitepaper-Token Economy-$BLP" section.

In the V1.0 version, we will update the multiple liquidity pool schemes based on the risk model to provide liquidity pools with different expected APY and risks for users to choose from.