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1. Liquidity Provision
Liquidity providers deposit assets (e.g., ETH, stablecoins) into the Swiv Vault.
- This pooled liquidity acts as the counterparty to trader positions.
- The vault pays out trader profits and earns trader losses plus protocol fees.
2. Perpetual Trading
Traders connect their Web3 wallet to Swiv and open long or short positions.
- Positions are fully on-chain, with leverage options available.
- Funding rates help keep perpetual contract prices in line with spot markets.
- Profits and losses are settled directly against the vault’s liquidity.
3. Fee Distribution
Fees from trading (including funding and transaction fees) are distributed to liquidity providers and the protocol treasury.
- Future governance mechanisms will decide fee splits and token rewards.
4. Risk Management
Swiv’s contracts manage margin requirements, liquidations, and vault risk parameters to protect liquidity providers.
Flow Overview
