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Open Liquidity Protocol

What is the Open Liquidity Protocol (OLP)?

DXS and the Open Liquidity Protocol (OLP) are separate entities. The OLP handles trade settlement and liquidity provisioning for DXS.
The OLP is designed to run on the BSV blockchain and be governed by a distributed network of unpredictably selected servers via multi-signature access. Currently, the protocol is hosted on a single server, maintained by DXS.
The OLP is responsible for:
  • ​Price feeds and associated bid/ask spreads
  • Holding the margin positions of trades
  • Allocating liquidity to trading sessions
  • Settling closed trades with traders
  • Carrying out profit deductions during liquidity crunches
  • Paying 3% of losing trades proportionally to liquidity providers
  • Paying 1% of losing trades to a bug fund
  • Charging liquidity fees​
The OLP is not responsible for:
  • Setting holding fees​
  • Brokerage services
    • DXS and other companies plugging into the protocol in the future will compete to offer traders the best user experience (while complying with regulations)
Additional information about the OLP:
  • Opening positions with margin is instant
  • Closing positions and return of margin is instant
  • Settlement of profits occurs in 8 hours or less
  • All trades are completely public, transparent and auditable
  • Price feeds are completely public, transparent and auditable
  • Anyone can contribute funds to the liquidity pool (subject to Liquidity Provider Agreement)
  • The size of the liquidity pool and associated session liquidity are completely public, transparent and auditable
  • Brokers never hold funds
  • Brokerages don’t profit from traders losing, brokers only profit from charging holding fees
  • Any broker can plug into the OLP and compete for users by offering the best user experience and holding fees

Who loses when I win and vice versa?

The Open Liquidity Protocol (OLP) is the counterparty for all trades on DXS. If you win on a trade, the OLP pays you. If you lose on a trade, you pay the OLP.
In any given 8 hour trading session, some traders close out positions in profit, and others at a loss.
In the case of a losing trade, margin less losses, holding fees and liquidity fees is returned. In the case of a winning trade, margin less holding fees and liquidity fees is returned. Winning traders must then wait until the end of the trading session for their profits to arrive.