AVAX Daily Doubling: How did Avalanche secure its position on the top derivatives exchange?

Original Title: Avantis: The Universal Leverage Layer - What You Need to Know

Original Source: Alea Research Daily Newsletter

Original Translation: Zhou, ChainCatcher

Editor's Note: From September 10th to 15th, Avantis (AVNT) successively landed on exchanges such as Coinbase, Upbit, Bithumb, and Binance. After being listed on Binance on the 15th, the price once broke through $2, with a single-day increase of over 100%.

Avantis enables users to use stablecoins as collateral for cryptocurrency, forex, commodity, and index trading. Since its mainnet launch in February 2024, Avantis has grown to become the largest derivatives trading platform in the Base ecosystem. This article provides a comprehensive introduction to Avantis, and the original article reprinted by BlockBeats is as follows:

Synthetic derivatives, decentralized oracles, and composable liquidity protocols allow traders to access everything from Bitcoin and ETH to gold and forex using stablecoin collateral.

Since Avantis went live on the mainnet in February 2024, it has become the largest derivatives trading platform on Base and the largest DEX in RWA trading and liquidity provision.

The protocol has processed over $18 billion in volume, executed over 2 million trades for 38,500+ traders. Avantis has $23 million TVL across 25,000+ LPs and 80+ markets, solidifying its position as the center of perps.

This article will explore Universal Leverage, Avantis' architecture, and the launch of $AVNT.

Avantis Introduction

Avantis is a perps DEX that allows users to trade cryptocurrency, forex, commodities, and indices using stablecoin collateral. The protocol abstracts away from a single order book and instead builds a "universal leverage layer" where any asset with reliable price feeds can be listed.

Synthetic Leverage is achieved through a USDC-backed liquidity treasury, which acts as the counterparty to all trades, enabling efficient capital exposure across multiple markets. Traders can choose leverage of up to 500x, allowing them to express directional views with minimal capital, while liquidity providers (LPs) earn yield by supplying USDC to backstop positions.

What sets Avantis apart from other perpetual contract trading platforms is that users can trade non-crypto markets such as the Japanese Yen, Gold, and US Stock Indices alongside BTC or ETH. The protocol's design also supports features like zero trading fees, loss rebates, and positive slippage, adjusting incentives between traders and LPs by returning a portion of fees or profits to users as the protocol's risk profile improves.

Avantis Architecture

At the core of Avantis is a capital-efficient synthetic engine. Traders use the protocol's interface to open positions on supported assets. Avantis does not match orders in an order book but pairs each trader with the USDC treasury that takes the other side of the trade. This treasury aggregates deposits from thousands of LPs and acts as a single counterparty. This structure allows the protocol to offer deep liquidity across many markets without needing a separate liquidity pool for each currency pair, enabling Avantis to list over 80 markets, including 22 RWA assets.

Avantis introduces risk tranches and time-lock parameters so that LPs can choose their preferred risk exposure. LPs can passively deposit into the senior tranche or take on more risk in the junior tranche, which offers higher return potential but absorbs a greater share of losses.

Additionally, LPs select time locks (e.g., 30 days or 90 days) to control the duration of their capital deployment, where longer locks incur higher fees. This design mirrors Uniswap v3's concentrated liquidity model while applying it to risk management in a perps trading platform.

Trader <> LP Alignment

Avantis' innovative mechanism further aligns the interests of traders and LPs.

Loss Rebates: Traders taking the opposite side of an open position (helping balance the platform's long/short skew) can receive up to a 20% loss rebate. This incentivizes traders to arbitrage open positions and stabilize LP exposure.

Positive Slippage: When a trader's order reduces the risk of the treasury (e.g., closing out heavily long positions), the entry price provided by Avantis is higher than the mark price. This "better than market" execution rewards traders for helping balance the flow.

Zero Trading Fees: Avantis pioneered a product where traders do not have to pay opening, closing, or borrowing fees. Instead, they only pay a portion of their profits when closing a winning trade. This tool is available for $BTC, $SOL, and $ETH with leverage of up to 250x, attracting whales and high-frequency traders.

Advanced Risk Management: LPs can act as either passive lenders or active market makers by selecting risk tranches and time locks. Each tranche has its own fees and potential loss share, allowing LPs to control risk and reward.

$AVNT: Token Issuance and Tokenomics

To foster its next stage of growth, Avantis has introduced the utility and governance token $AVNT.

$AVNT serves multiple purposes:

Security and Staking: Holders can stake $AVNT in the Avantis security module to support the USDC Treasury during extreme market fluctuations. Stakers receive $AVNT rewards and trading fee discounts.

Community Rewards: 50.1% of the total token supply of 1 billion is reserved for traders, liquidity providers, referrers, and builders contributing to Avantis. The airdrop 1 (12.5% of the supply) will reward protocol activity since February 2024, while on-chain incentives (28.6%) will fund future XP seasons and community contributions. Builders and ecosystem grants (9%) will support the creation of new frontends and trading tools, such as AI agents and Telegram bots.

Governance: Token holders will be able to propose and vote on protocol decisions, ranging from asset listings and fee structures to buyback plans and cross-chain deployments.

The remaining 49.9% of the supply is allocated as follows:

· Team (13.3%)

· Investors (26.61%)

· Avantis Foundation (4%)

· Liquidity Reserve (6%)

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