Parcl V3: An Evolved Perpetual Futures DEX
Parcl V3 elevates trading in synthetic real estate markets, offering significant advancements over previous versions. With dynamic risk management, dollar-for-dollar accounting, enhanced capital efficiency, and a single, scalable liquidity pool, V3 is a testament to sophisticated trading. It is the best venue for liquid real estate exposure.
Parcl V3 is the product of a successful V2 and invaluable user feedback from the Parcl community. Quickly reflecting on V2’s successes:
- First-ever synthetic real estate perpetual market
- 21 different markets tracking real-world real estate values
- Over $3.5M notional volume traded
- More than 3500 unique wallet connects
- Over 800 unique traders
Thank you to all Parcl traders for your support and commitment to Parcl's mission of bringing real estate to everyone. We look forward to seeing you active on Parcl V3.
Reminder: Support for V2 is winding down. Be sure to close your V2 positions promptly.
Key Features and Enhancements in V3:
Architecture and Governance
- Single Liquidity Pool per Exchange: V3 introduces a scalable Liquidity Pool model, enhancing protection for liquidity providers (LPs) and promoting delta neutrality through advanced risk management (details below).
- Traditional Margin Model: Unlike V2’s mathematical leverage approach, V3 implements a cross-margining system for more effective leverage management.
Risk Management Enhancements
- Price Impact: Traders’ prices adjust based on their market impact in terms of skew (long & short). This dynamic system incentivizes balance, offering discounts for trades that reduce skew and premiums for those that increase it. Benefits include: a) Delta neutrality for LPs, moderating trade volume relative to market skew. b) Market-adaptive pricing, reminiscent of market makers adjusting spreads.
- Funding Rate: V3's funding rate mechanism, similar to other perpetual platforms, is refined to be more responsive to market conditions, adjusting to the rate the exchange can sustain.
- Margin System: Margin requirements scale with trade size, correlating with the risk to LPs.
- Maker/Taker Fees: Trades that increase skew are charged 'maker' fees, while trades that reduce skew incur 'taker' fees. Fee rates are proportionate to their skew impact, offering blended rates for skew-altering trades.
- Flexible Governance: Exchange settings and market settings are configurable in V3, ensuring responsiveness to changing market dynamics.
Further details can be found on the documentation site.
Key UX Improvements:
- Single Pool Structure: One LP pool underwrites all markets on the exchange.
- Trading Fees: LPs collect a percentage (70%) of long/short trading fees generated on the DEX, which they split with the protocol.
- Delta Neutrality and Leverage: The protocol's features aim for a delta-neutral LP pool, balancing trader PnL over time.
- Stable Collateral: A single stablecoin collateral (USDC) is used for both LP capital and cross-margin accounts.
- More Predictable PnL Outcomes: Dollar-for-dollar trading ensures straightforward PnL calculations.
- Capital Efficiency: Trade with up to 10x leverage, with adjustable caps.
- Cross Margin: Utilize profits from successful positions to balance others.
Parcl V3 is launching with six tradable North American markets, with more rolling out over the coming weeks.
Disclaimer: This article has been written purely for educational purposes. This article is not intended to be investment advice of any kind.