🧬 | Fundamentals
Last updated
Last updated
Unlimited Leverage is an on-chain leverage trading platform that offers gasless, synthetic trading with zero price impact, minimal slippage, and up to 100x leverage.
Woah - that's a lot of big words. What does that all mean?
To achieve gasless trading, we developed our own custom price feed and order book, that secures the protocol from front-running and other bots, while ensuring traders get the most accurate pricing. With this setup, traders simply need to send 1 transaction to inform the protocol of your stablecoin allowance, after which they are able to trade simply by signing messages ($0 cost).
Example: Pepe Jr. wants to 100x long Bitcoin on Unlimited Leverage with 1,000 USDC because he heard it's going to $1M in 90 days. After placing his trade parameters, he needs to approve the 1,000 USDC spend amount (which costs gas), but once approved, he can trade that amount of USDC freely without paying any gas costs (simply sign transactions). However, if he now wants to trade 10,000 USDC because he convinced his family that they need to get in on this "once in a lifetime, guaranteed trade", then he'll need to approve another USDC spend allowance (10,000 USDC), resulting in another on-chain transaction (costing gas).
Synthetic trading implies that you are not handling the actual assets or trading/transferring tokens on-chain. Instead, tokens are price-matched allowing us to offer a trading service without the slippage or price impact normally seen in relatively illiquid on-chain crypto markets.
Example: Pepe Jr. is tired of seeing Sergey dump their LINK tokens. So, he thinks "well, if you can't beat 'em, join 'em" and decides he's going to 100x short LINK. Because Unlimited Leverage offers synthetic trading, neither Pepe Jr., nor Unlimited Leverage need to own any LINK for the trade. Instead, the protocol uses a price feed and custom order book to allow Pepe Jr. to short LINK with all his USDC, and likely end up shorting the global bottom.
Because the tokens on Unlimited Leverage are synthetically traded and the price is determined by a pricing oracle, trade size on Unlimited Leverage will not impact the pricing - hence 0 price impact.
Example: Pepe Jr. opens a $100 long on BTC and a $100,000 long on ETH. Neither trade will affect their respective prices, because the pricing is purely determined on the price feed provided by the oracles, and not based on trade size occurring on Unlimited Leverage.
In the case of Unlimited Leverage, price slippage occurs when there is a difference between the current price (provided by the price oracle) and the price when the user's transaction confirms. Because of the protocol design, slippage due to frontrunning and other bots is eliminated, drastically reducing the potential slippage.
On Unlimited Leverage, we allow you to trade with up to 100x leverage on all assets that are available. Leverage trading allows you to amplify your buying or selling power, which can result in increased potential profits. However, leverage trading can be extremely risky, and as such, it is highly recommended to learn more about leverage trading prior to using it.
