Friendly Pools
WAODAO’s liquidity architecture is built on the concept of Friendly Pools — interconnected liquidity pools that cooperate to maintain balance, stability, and long-term strength of the WAO token.
At the current stage, two core pools are live on Ethereum / Uniswap DEX:
These pools are not isolated; together they act as a decentralized, auto-rebalancing portfolio that naturally adjusts its composition between Ethereum, Bitcoin, and WAO based on real-time market movements.
⚖️ Auto-Rebalancing Mechanism
Each Friendly Pool follows the constant-product formula:
x⋅y=k
which ensures that the value between WAO and its paired asset continuously rebalances.
When market prices fluctuate, arbitrage traders automatically smooth out these movements by rebalancing value across all WAO pools. Their activity keeps each pool aligned with external market prices and helps maintain a natural equilibrium between assets. Through this continuous process, the system captures volatility, stabilizes WAO’s relative value, and strengthens the overall liquidity network.
Together, the WAO/ETH and WAO/WBTC pairs form a self-adjusting portfolio, dynamically stabilizing the token’s long-term value without centralized management or team intervention.
📉 LVR (Loss Versus Rebalancing)
Like all Automated Market Makers (AMMs), Friendly Pools experience LVR — the small efficiency gap between the real pool value and a hypothetical portfolio that rebalances perfectly at every market tick.
In practice, this difference represents the profit captured by arbitrageurs who help realign the pool price with the external market. However, those same trades generate fees that are paid directly to liquidity providers, often compensating — or even exceeding — the LVR effect over time.
💰 Commissions & Volatility Harvesting
Every trade through a WAO pool charges a small swap fee (e.g., 0.3%), which is distributed among liquidity providers. Because arbitrage and user trading activity occur continuously between ETH, WBTC, and other markets (in future), these fees accumulate into a steady volatility yield.
The higher the market activity and volatility, the greater the flow of commissions back to LPs — turning natural market motion into a sustainable income stream.
🌐 Cross-Chain Expansion
The next step for WAODAO is cross-chain liquidity expansion:
WAO/TON — on the TON blockchain
WAO/SOL — on the Solana network
These upcoming pools will connect WAO liquidity across multiple ecosystems, allowing cross-chain arbitrage and natural price synchronization between Ethereum, Bitcoin (via WBTC), TON, and Solana.
This will transform WAO into a multi-chain auto-rebalancing portfolio, spreading risk and capturing value from diverse crypto markets.
🚀 Strategic Impact
Through its expanding network of Friendly Pools:
WAO gains greater price stability through continuous, market-driven rebalancing.
Liquidity providers earn commissions and volatility premiums, offsetting LVR.
The token itself becomes part of a living, self-balancing treasury — anchored by Ethereum, Bitcoin, TON, and Solana.
In essence, WAO evolves beyond a single token into a cross-chain, auto-rebalancing ecosystem, reflecting the collective strength of the top decentralized networks.
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