Liquidity improvement and volatility stabilization

Purpose

Client`s requirement was to create an optimal strategy to prevent a sharp price decrease amid putting a huge number of volume sell orders in a limited period (dump).

Service

Consulting, Liquidity Provision

Main Steps

The BeLiquid team has analyzed the trading token's history to understand the impact of previous cases and develop further token trading strategy.

The results pointed out that the optimal solution to the significant volatility reduction would be the combination of two approaches:

1) price maintenance by putting the maximum number of orders at the given price level;

2) applying soft price control by allowing a price to damp or pump in a short period under a trade activity.

The benefit of this approach is the minimum token budget for support issues.

Balancing between the two approaches depends on the project's reputation risks and available budget for development.

It is also important to remember the risks of a "panic sale" — the snowballing selling of sufficient tokens volume due to the panic amid a quick price damp.

Beliquid team is confident to manage such risky and difficult strategies due to the skill set of our analytics and quick reaction to order book management.

Result: token price stabilized with 50% of originally calculated budget

Token/USDT trading pair has revert to the average natural volatility. Sellers and buyers trade at a fair price at any moment. The trades chart looks attractive and encourages traders to involve more actively than before.

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