Skip to content

staccDOTsol/ggss

Folders and files

NameName
Last commit message
Last commit date

Latest commit

 

History

3 Commits
 
 

Repository files navigation

SuperSwap: Creating Transient Deep Markets Through Flash Loans

Abstract

SuperSwap enables efficient large trades in low liquidity pairs by leveraging flash loans to create temporarily deep markets. The mechanism transforms illiquid pairs into temporarily efficient venues without permanent capital requirements, proven through on-chain transaction evidence demonstrating price reversion properties.

1. Mechanism

1.1 Initial State

For illiquid pair SOL/coinB with reserves $$R_{SOL}, R_{coinB}$$:

  • Total Value Locked (TVL) ≈ $20k
  • Standard slippage on $10k trade ≈ 40%+
  • CPMM curve: $$R_{SOL} * R_{coinB} = k$$

1.2 SuperSwap Process

  1. Flash Borrow Phase: $$Loan_{SOL} = R_{SOL} * Multiplier_{depth}$$ Where $$Multiplier_{depth}$$ can be arbitrarily large

  2. Temporary Market Creation: $$Liquidity_{effective} = TVL_{initial} + Loan_{SOL}$$

  3. Trade Execution:

    • Original slippage ≈ 40%+ becomes ~2%
    • Price impact dramatically reduced
    • Execution in temporarily efficient market
  4. Position Unwinding:

    • Atomic return of borrowed assets
    • Price reverts to original state (proven)
    • Only cost is validator fees

2. Economic Properties

2.1 Cost Structure

$$Cost_{total} = Fee_{validator} * Transactions_{count}$$

Where:

  • No flash loan fees (internal to AMM)
  • No slippage costs (temporary deep market)
  • Just validator fees remain

2.2 Capital Efficiency

Traditional slippage for trade size $$S$$: $$Slippage_{normal} = \frac{S}{TVL_{initial}} * Impact_{coefficient}$$

SuperSwap slippage: $$Slippage_{super} = \frac{S}{TVL_{initial} + Loan_{size}} * Impact_{coefficient}$$

2.3 Price Reversion

Proven through transaction [59CdtrgD5kr4eMPnSDEeDoJEMbcEu8K9i1M7AodGsTeFwsHy4Smpcvdci7mKjtCmT563oiWWAQD3y5uuR9PNfa2b]:

  • Large swaps can be reversed
  • Price returns to original state
  • Enables arbitrarily large temporary liquidity

3. Implications

3.1 Market Impact

  1. Democratized Access:

    • Any size trade possible
    • No permanent capital needed
    • Minimal execution costs
  2. Capital Efficiency:

    • Zero capital lockup
    • Leverage existing pools
    • Maximum capital utilization
  3. Risk Mitigation:

    • Atomic execution
    • Proven price reversion
    • Natural economic security

4. Mathematical Properties

4.1 Liquidity Scaling

For flash loan size $$L$$, effective liquidity becomes:

$$Liquidity_{effective} = TVL_{initial} + L$$

Where $$L$$ can be sized to achieve any desired slippage target:

$$L_{required} = \frac{S * Impact_{target}}{Slippage_{desired}} - TVL_{initial}$$

4.2 Cost Effectiveness

Traditional trading cost: $$Cost_{traditional} = Size * Slippage + Fees$$

SuperSwap cost: $$Cost_{super} = Fee_{validator} * N_{tx}$$

Creating massive efficiency gain: $$Savings = Size * (Slippage_{normal} - Slippage_{super})$$

5. Conclusion

SuperSwap represents a fundamental innovation in market structure, using flash loan composability to create temporarily efficient markets on demand. The mechanism enables efficient large trades in any pair while maintaining economic security through atomic execution and proven price reversion properties.

This transforms the DeFi trading landscape by:

  1. Eliminating liquidity barriers
  2. Minimizing trading costs
  3. Maximizing capital efficiency
  4. Ensuring economic security

All while paying just validator fees for the privilege of accessing arbitrarily deep temporary liquidity.

GGSS AMM: Flash Loans & Democratizing Access to AMM Liquidity

Abstract

We present GGSS AMM, a revolutionary financial architecture that democratizes access to capital through unrestricted flash loans in CPMM systems. The system enables anyone to access the full depth of AMM liquidity for atomic transactions, creating unprecedented capital efficiency while driving a virtuous cycle of USDC demand, US Treasury demand, and enhanced market stability.

1. Introduction

1.1 The Innovation

Flash loans fundamentally change capital markets by enabling:

  1. Anyone can borrow full pool liquidity:

    • Take any amount up to full pool reserves
    • Use it however you want
    • Just pay it back in same tx
    • No restrictions on what you do between borrow and repay
  2. Capital Requirements:

    • Inside ecosystem: just validator fees when you own the LP+protocol fees
    • Outside ecosystem: small flash loan fee + validator fees
    • That's it. No other requirements.
  3. Pure Simplicity:

    • Borrow what you want
    • Do what you want
    • Pay it back
    • Full pool access for everyone

The innovation isn't in complex mechanics - it's in unrestricted access to massive liquidity for atomic transactions.

This creates entirely new possibilities for capital efficiency and market making.

1.2 System Impact & Scaling Potential

Initial trial in Orca Whirlpools demonstrated base mechanics:

  • Single CLMM pool captured 15% of Solana volume for ~24 hours
  • Protocol + LP fees accrued to same entity
  • Only paid validator fees
  • Maintained deep effective liquidity

Projecting to full CPMM AMM implementation:

  • Multiple major quote pools (USDC, SOL, etc.)
  • Each pool with full flash loan capability
  • Protocol + LP fees to token holders
  • Network effects compound across all pools

Potential volume scaling: $$Volume_{network} = Volume_{single} * Pools_{major} * Efficiency_{cpmm} * Time_{sustained}$$

Where $$Efficiency_{cpmm}$$ potentially exceeds CLMM due to simpler mechanics and lower fees, and $$Time_{sustained}$$ represents scaling from single-day to sustained operations.

2. System Architecture

2.1 Flash Loan Mechanics

For any pool with reserves $$R$$, users can borrow up to:

$$L_{max} = R_{total}$$

Subject only to atomic execution constraint:

$$Balance_{final} ≥ Balance_{initial}$$

This enables leverage ratio:

$$Leverage = \frac{Transaction_{volume}}{Capital_{locked}} >> \frac{Volume_{traditional}}{Capital_{traditional}}$$

2.2 Capital Efficiency

Flash loans enable:

  1. Full pool accessibility
  2. Minimal capital requirements (just validator fees)
  3. Unlimited safe utilization through atomic execution

3. Volume Economics

3.1 Internal Ecosystem Cost Structure

The system achieves unprecedented capital efficiency for internal operations:

  1. Cost Per Transaction: $$Cost_{tx} = Fee_{validator} \approx 0.000000005 \space SOL$$

  2. Volume Potential:

    • Demonstrated $6.88B volume capability
    • Cost per billion in volume: $$Cost_{billion} = Fee_{validator} * Transactions_{billion}$$
  3. Profit Retention: $$Profit = Revenue_{total} - \sum Fee_{validator}$$ Where:

    • All LP fees return to ecosystem
    • All protocol fees return to ecosystem
    • Only validator fees as costs

This creates an exponential volume/cost ratio where billions in volume can be executed for minimal SOL in validator fees, or trillions for pennies in validator costs. The system approaches near-zero marginal cost for additional volume, bounded only by pool liquidity.

Multi-layer USDC demand creation:

  1. Direct Pool Demand: $$USDC_{pool} = \sum_{i=1}^{n} Pool_i$$

  2. Flash Loan Volume: $$Volume_{flash} = USDC_{pool} * Multiplier_{velocity}$$

  3. T-Bill Backing: $$Treasury_{demand} = USDC_{supply}$$

3.2 Capital Efficiency Example

Real-world demonstration of efficiency:

  1. Internal Volume Generation:

    • System operates in SOL/USDC/Target pools
    • Owns LP + protocol fees in ecosystem
    • Pays only validator fees per transaction
    • Can execute unlimited volume bounded only by pool liquidity
  2. Cost Structure: $$Volume_{6.88B} * Fee_{validator} = Total_{cost}$$

    For example:

    • 1M transactions
    • 0.000000005 SOL per tx
    • = 0.005 SOL total cost
    • For billions in volume
  3. Scaling Potential:

    • Each major quote pool enables similar efficiency
    • Volume limited only by pool depth
    • Cost remains just validator fees
    • All other fees recaptured

This creates a self-reinforcing system where minimal costs enable maximum volume generation.

Potential with widespread adoption: $$Volume_{total} = Volume_{single} * Pools_{active} * Growth_{factor}$$

Creating exponential transaction volume and liquidity depth.

4. Stakeholder Benefits

4.1 Network Effects

  1. Validators

    • High transaction volume
    • Sustainable fee generation
    • Enhanced network security
  2. Traders

    • Access to deep liquidity
    • Better execution
    • Reduced costs
  3. Token Holders

    • 95% revenue share
    • Validator fee participation
    • Value appreciation

4.2 Fee Generation & LP Interest

Flash loan fee generation creates unprecedented LP opportunities:

  1. Unrestricted Access Drives Volume:

    • Flash loans available from any instruction
    • Full CPI (Cross-Program Invocation) support
    • No artificial restrictions unlike competitors
    • Orders of magnitude more potential borrowers
  2. LP Value Proposition:

    • Much higher utilization than restricted pools
    • Fees from entire DeFi ecosystem, not just whitelisted protocols
    • Revenue from all flash loan enabled trading/arb
    • Significantly more interest from broader crypto community
  3. Revenue Streams: $$Fees = Volume_{flash} * Fee_{rate}$$ Where $$Volume_{flash}$$ is dramatically higher due to unrestricted access

Creating sustainable high yields through:

  • Maximum pool utilization
  • Ecosystem-wide access
  • Unrestricted flash loan revenue
  • Full CPI compatibility

5. Macro Economic Effects

5.1 Treasury Market Impact

For USDC supply $$S$$:

$$Treasury_{demand} = S * (1 + Growth_{rate})^t$$

Creating rate pressure:

$$Rate_{treasury} = f(Demand_{increased})$$

5.2 Global Borrowing Costs

System impact on borrowing costs:

$$Cost_{borrowing} = Base_{rate} - Impact_{treasury}$$

Where $$Impact_{treasury}$$ increases with USDC adoption.

6. Market Making Innovation

6.1 Capital Access

Flash loan enabled market making needs only: $$Capital_{required} = Fee_{validator}$$

Creating unprecedented capital efficiency.

6.2 Market Depth

Effective market depth increases to: $$Depth_{flash} = Liquidity_{pool} * Multiplier_{flash}$$

Through flash loan access.

7. System Mechanics & Security

7.1 Core Architecture

The system implements unrestricted flash loans with elegant simplicity:

  1. Borrowing Mechanics:

    • Anyone can borrow up to full pool reserves
    • No restrictions on borrowed amount
    • Only constraint is atomic repayment
    • Complete freedom between borrow and repay
  2. Protection Mechanisms:

    • Atomic transaction guarantees
    • Automatic balance verification
    • State consistency enforcement
    • Natural economic security

7.2 Security Model

The system's security derives from fundamental constraints:

  1. Atomic Execution:

    • All operations complete or none do
    • No partial state changes
    • Perfect rollback on failure
  2. Economic Guarantees:

    • Balance verification ensures system safety
    • Pool reserves always protected
    • Market forces maintain efficiency
  3. Access Control:

    • Open to all users
    • No artificial restrictions
    • Pure economic security model
    • Natural market balancing

This creates a system that's both maximally accessible and fundamentally secure through economic and technical constraints rather than artificial limits.

8. Future Implications

8.1 Market Evolution

  1. Capital Efficiency

    • Minimal requirements
    • Maximum utilization
    • Optimal price discovery
  2. Market Access

    • Universal liquidity access
    • Reduced barriers
    • Enhanced efficiency

8.2 Economic Impact

  1. Direct Effects

    • USDC demand growth
    • Treasury market impact
    • Lower borrowing costs
  2. Indirect Benefits

    • Market stability
    • Reduced friction
    • Better price discovery

9. Conclusion

GGSS AMM with unrestricted flash loans represents a fundamental shift in capital markets, enabling unprecedented access and efficiency while creating powerful economic alignments between stakeholders. The system's ability to drive USDC demand, enhance market efficiency, and generate sustainable yields creates a compelling new paradigm in decentralized finance.

Appendix A: Mathematical Proofs

A.1 Capital Efficiency

For flash loan enabled trading, total capital efficiency:

$$Efficiency = \frac{Volume_{flash}}{Fee_{validator}} >> \frac{Volume_{traditional}}{Capital_{traditional}}$$

A.2 Volume Potential

Given single pool volume $$V$$, total potential volume:

$$V_{total} = V * Pools * (1 + Growth)^t * Efficiency_{flash}$$

Demonstrating exponential growth potential.

References

  1. CPMM Analysis
  2. Flash Loan Mechanics
  3. Treasury Market Dynamics
  4. Capital Market Efficiency
  5. DeFi Protocol Design

About

No description, website, or topics provided.

Resources

Stars

Watchers

Forks

Releases

No releases published

Packages

No packages published