Introducing Liquidity Book V2.1 – by Blue

• Autopools: Automated strategy execution layer for the liquidity book

• Autopool Receipts: Deposit and collect rewards, yield farming we all love

• sJOE: Participate in sJOE and get your share of trading activity

• Permissionless pools: Anyone can open a liquidity book pool

• The charges are now increasing: Optimizing gas consumption by around 30-40%

• Migration to new V2.1 liquidity pools

• Maker-style limit orders (deliver at a later date)

Welcome to a new era of DeFi yield farming. Trader Joe builds, and everything that comes as part of V2.1 has been designed from the ground up and tailored for Liquidity Book’s innovative discretized liquidity architecture. Liquidity Book offers a market-leading level of customization and flexibility, but V2.1 takes it a step further by democratizing the ability for anyone to access the power of Liquidity Book. Expect a market-leading experience with V2.1. Trader Joe is pioneering the future of AMMs and the role they play in DeFi ecosystems. This starts today.

All of the features and enhancements described in this article are rolling out starting today (April 6) and will be rolled out and scaled gradually over the coming weeks.

Autopools add an automated tool to implement liquidity strategies for liquidity book pools. Users who do not want to actively manage their liquidity positions themselves can use an autopool instead.

• When volatility is low, liquidity is concentrated around the active bin

• As volatility increases, the spread widens

• Inputs: twap and volatility

• Outputs: position and shape size

Over time, autopools will expand to include more exotic strategies that may include off-chain signals, different asset mixes, and more.

Autopool strategies are executed using off-chain scripts controlled by a “black box”. The Black Box allows strategies to be updated in real time. This means that autopool strategies can be updated dynamically, allowing for optimization for market conditions and a process of constant iteration to improve performance.

• Autopools are in the final testing phaseWe expect more information on launch strategies and deployment details shortly. Autopools will power the Trader Joe platform with a fully native Liquidity-as-a-Service experience built by our passionate team dedicated to driving true innovation and sustainability in the AMM space.

Deposit tokens into an autopool and receive a token receipt that can be used for further DeFi activities such as yield farm, collateralization and leverage. This is the “V1” style of DeFi yield farming that many users are familiar with and is only possible thanks to Liquidity Book’s fungible liquidity architecture.

Trader Joe is collaborating with a number of partners at Arbitrum, Avalanche and BNB to work on integrating autopool token slips for more DeFi use cases.

A percentage of the fees incurred in liquidity book pools are passed directly to sJOE Stakers. Fee sharing is exclusive to each chain, meaning that sJOE on Arbitrum shares Arbitrum fees and sJOE on Avalanche shares Avalanche fees. The sJOE Fee share is live for all V2.1 Liquidity Pools which are now being opened on Avalanche. Expect sJOE to scale as V2.1 pools migrate and deploy.

Below is the fee participation rate by market grouping:

Please note that the final fee breakdown is subject to change and the core team reserves the right to adjust the market-level fee breakdown post-release to ensure optimization for all users

Liquidity book pools are currently permitted. However, the permissionless pool feature opens the taps for liquidity book pools, which can be opened by anyone who has a default configuration set to 100 bps discretization (0.8% basic fee for trading). Permissionless pools can only be paired with whitelisted quotes: Avalanche (AVAX, USDC, BTC.b, and UTDT) and Arbitrum (ETH, USDC, USDT, and BTC.b). New discretization configurations could be added in the future.

Governance still remains the best path for projects that want a tailored market for their token. Governance suggestions can be submitted on the Trader Joe Discord Forum.

Liquidity Book V2.1 comes with a complete code overhaul that implements a number of important optimizations. V2.1 will greatly improve user experience when transacting or managing liquidity on Liquidity Book Reduction of average gas costs by 30-40%. This helps further drive protocol adoption among users and partners looking to build on top of the AMM.

A major change in this optimization is that users can no longer claim the fees incurred All fees are automatically requested and settled into the active container from which charges were incurred. This kind of improvement is only possible thanks to the fungible discretized bin architecture on which Liquidity Book is built. All accrued user fees can be tracked per hour or per bin using the analytics built into the Liquidity Book pool pages.

Due to the complete code overhaul, all contracts are completely new for Liquidity Book V2.1 and therefore Liquidity Book pools will migrate from the current V2 version to V2.1. This will be done in tranches to minimize disruption across the platform. The process is as simple as withdrawing liquidity and then re-depositing it into a new liquidity pool. The focus of the migration to V2.1 pools will start with smaller liquidity pools on Avalanche and scale up across chains from there. We assume that the migration will take several weeks for all chains.

All liquidity pools marked “Migration” have an active V2.1 pool to migrate to. To understand this process step by step, please see the guide below

Users will soon be able to set up swap instructions that will execute buying or selling a token at desired price points across all liquidity book markets. This feature will be a native build and will act as a “maker” style liquidity order where the user deposits tokens into a liquidity book pool with instructions to withdraw the liquidity when the desired price is reached. As a liquidity provider, you get complete control over your delivery strategy. This allows you to execute swaps for free at your exact price target while earning your share of the fees incurred by the pool when executing the limit order.

Liquidity Book V2.1 and Autopools have been audited by our trusted partner, Paladin security. In an ongoing interest in securing logs and code through multiple audits, both V2.1 code and Autopools are subject to an audit competition program immunofi, this will start soon.

Trader Joe is a leading multi-chain decentralized exchange and the creator of Liquidity Book, the most efficient AMM in DeFi. Trade hundreds of your favorite DeFi tokens, access the most powerful yield farming experience with Auto-Pools, and shop for the latest digital collectibles on the Joepegs NFT Marketplace. Trader Joe makes DeFi easy.

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