Goal Tree

Goal Tree

Optimize Liquidity Provision System in UniswapV4

Description: Maximize liquidity fulfillment through a dynamic JIT/PLP equilibrium, enforced via hook-based taxation and redistribution while managing time-bound LP positions.

Sub-Goals

• Balance JIT and PLP Participation: Create equilibrium where JITs complement PLPs without crowding them out, using deadline-aware position management.

  • Implement JIT Taxation System: Tax JIT-provided liquidity fees during swaps (via beforeSwap/afterSwap hooks) based on position duration and impact.

    • Calculate Context-Aware Tax Rates: Dynamic tax rates based on JIT position longevity, trade size, and market impact.

    • Enforce Deadline Compliance: Ensure JIT liquidity expires after LP-specified deadlines via hook logic.

  • Redistribute to PLPs: Distribute taxed JIT revenue to PLPs post-liquidity removal (via afterRemoveLiquidity hook).

    • Weight PLP Rewards by Contribution: Allocate rewards based on PLP liquidity depth and longevity.

• Maximize System Welfare: Optimize overall efficiency by calibrating JIT/PLP incentives in real-time.

  • Dynamic Parameter Adjustment: Adjust tax/redistribution parameters via hooks using on-chain data (e.g., JIT/PLP participation ratios).

• Ensure Liquidity Fulfillment: Maintain capacity to fulfill demand through coordinated JIT/PLP participation.

  • Facilitate JIT Liquidity Windows: Enable short-term JIT provisioning for large trades without disrupting PLP depth.

  • Sustain PLP Baseline Depth: Ensure PLPs are rewarded sufficiently to maintain always-on liquidity.