❓FAQ

Frequently Asked Questions (FAQ)

General Questions

1. What is Möbius Exchange? Möbius Exchange is an innovative decentralized exchange designed to maximize liquidity efficiency and optimize swaps for stablecoins, Liquid Staking Tokens (LSTs), Liquid Restaking Tokens (LRTs), and other pegged assets. By leveraging the Asset Liability Management (ALM) model, Möbius ensures minimal slippage, seamless trading, and a robust liquidity provisioning system.

2. How does Möbius differ from traditional Automated Market Makers (AMMs)? Unlike traditional AMMs, which define equilibrium as having equal balances of all assets, Möbius achieves equilibrium when each asset remains solvent, meaning its liabilities match its assets. This model enhances capital efficiency by dynamically adjusting swap rates based on market conditions and liquidity needs.

3. What are the key benefits of using Möbius Exchange?

• Single-Sided Liquidity Provision: LPs can deposit and withdraw a single asset, simplifying participation.

• Extendable Multi-Asset Pools: Supports more than two assets in a pool, reducing liquidity fragmentation.

• Optimized Swap Rates: Ensures stable and efficient trading with minimal slippage.

• Fine-Tuned Emission Control: Allows precise incentive targeting for enhanced capital efficiency.

• Seamless DeFi Integrations: Enables integration with aggregators, lending platforms, and structured products.

Liquidity Provision

4. What is Single-Sided Liquidity Provision, and how does it work? Single-Sided Liquidity Provision allows LPs to deposit one asset into a pool without needing exposure to multiple tokens. This simplifies liquidity provision, enhances flexibility, and reduces impermanent loss risks.

5. How does Möbius ensure efficient liquidity utilization? Möbius uses ALM principles to adjust swap incentives dynamically, encouraging trades that restore equilibrium in the pool. This prevents excessive imbalances and ensures optimal liquidity utilization.

Swap Mechanism and Pricing

6. How does the swap mechanism work on Möbius? Möbius adjusts swap rates based on the coverage ratio of each asset in the pool. Trades that move the pool toward equilibrium receive better rates, while trades that push the pool further from equilibrium face less favorable rates.

7. What is the Coverage Ratio, and why is it important? The Coverage Ratio (Asset/Liability) ensures that each token account maintains solvency. Equilibrium is reached when all token accounts have equal coverage ratios, preventing liquidity fragmentation and inefficiencies.

8. How does Möbius handle price fluctuations and extreme market conditions? The protocol dynamically adjusts rates using the rateAdjustment() function, discouraging trades that worsen imbalances and incentivizing those that restore equilibrium. This ensures price stability even during volatile market conditions.

Withdrawal & Fees

9. Are there fees for withdrawing liquidity?

• No fees for withdrawing assets with a coverage ratio ≥ 100%.

• Minimal fees for assets with a slightly lower coverage ratio (e.g., 90%).

• Higher fees apply when withdrawing assets with extreme under-coverage (e.g., 70%), ensuring the stability of the pool.

10. How are swap and withdrawal fees distributed? Fees accumulate within the protocol surplus to strengthen liquidity resilience. Once governance is enabled, the community can decide on the distribution of fees among LPs and governance token holders.

Integration & Ecosystem

11. How does Möbius contribute to the Mantle ecosystem? Möbius serves as the primary liquidity engine for Mantle, optimizing stablecoin and LST/LRT swaps. It enhances liquidity depth, fosters ecosystem growth, and ensures stable pricing, driving sustainable expansion.

12. Can other DeFi protocols integrate with Möbius? Yes, Möbius is fully composable, allowing DeFi aggregators, lending markets, and structured products to build on top of it. Möbius LP tokens are yield-bearing assets that can be used for collateralization and fixed-yield strategies.

Security & Governance

13. What security measures does Möbius implement? Möbius employs multiple security layers to safeguard user funds and ensure system integrity:

• Ongoing Audit: Möbius is undergoing an audit by a reputable third-party security firm. The full audit report will be published before the mainnet launch.

• Formal Verification: Möbius contracts have undergone rigorous formal verification, mathematically proving resistance to exploits and liquidity leakage under all transaction scenarios.

• Restrictive Contract Interface: The contract prevents multiple function calls (e.g., swap, deposit, withdraw) within a single transaction, effectively neutralizing flashloan attacks without affecting normal user operations.

14. How does the Restrictive Contract Interface improve security? By preventing functions like swap, deposit, and withdraw from being called within the same transaction, Möbius eliminates the risk of flashloan attacks, a common DeFi exploit that relies on executing multiple operations in a single transaction. This ensures higher security without compromising composability or user experience.

15. Will there be governance for Möbius? Yes, governance will be introduced, allowing the community to participate in decisions related to fee distribution, incentive mechanisms, and future upgrades.