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Advanced Topics

Perpification Technical Details​

How does perpification actually work?​

LemonMarkets uses virtual market making to create synthetic perpetual markets:

  1. Oracle Integration: Connect reliable price feed for any asset
  2. Virtual Liquidity: Protocol creates algorithmic liquidity without requiring massive capital
  3. PvP Matching: Traders compete against each other (long vs short)
  4. Shared Insurance: Community pool protects against extreme losses
  5. NFT Positions: Each perpified position is a transferable NFT

What makes perpification capital-efficient?​

Traditional perp DEXs need liquidity pools for each market - often millions per asset. This limits how many markets they can support.

LemonMarkets uses virtual liquidity, requiring minimal capital per perpified market. This enables:

  • Perpification of thousands of assets
  • Long-tail and micro-cap markets
  • Instant new market creation
  • Fair pricing for all assets

What oracles do you use for perpified markets?​

We integrate multiple oracle providers for maximum reliability:

  • Chainlink - Decentralized price feeds
  • DIA Data - Cross-chain oracle network
  • Pyth Network - High-frequency financial data
  • Custom Aggregators - For exotic assets

Each perpified market uses the most reliable oracle(s) for that specific asset.

Can I perpify my own token or NFT?​

Yes! If you have a reliable price feed, you can request perpification of any asset. The community and protocol governance decide on oracle reliability and market parameters.

Liquidity Provision​

Can I provide liquidity?​

Yes! LemonMarkets features Liquidity Providers (LPs) who can earn from trader activity. Here's how it works:

Segregated Liquidity Model:

  • Each market has its own dedicated liquidity pool
  • Liquidity is not shared across markets
  • You choose which specific markets to provide liquidity for

How LPs Earn:

  • Earn from trader losses - When traders lose, LPs profit
  • Market-specific returns - Each market has different risk/reward
  • No impermanent loss - You're not providing spot liquidity

Is LP Required?:

  • Adding LP is NOT compulsory for markets to exist
  • Markets function with virtual liquidity and trader collateral
  • LPs enhance market depth and capacity
  • Optional way to earn yield while supporting markets

LP Strategy:

  • Choose markets you believe will have net losing traders
  • Diversify across multiple perpified markets
  • Monitor market performance and adjust allocation

How does PvP (player-vs-player) trading work?​

Unlike traditional perps where you trade against a pool, LemonMarkets matches:

  • Longs vs Shorts - Your gain is another trader's loss
  • Balanced Risk - No directional bias from protocol
  • Fair Markets - No house edge or LP extraction
  • Shared Insurance - Community pool protects all traders

Building on LemonMarkets​

Can I build on LemonMarkets?​

Yes! We're open-source and composable:

  • APIs: RESTful and GraphQL endpoints
  • Smart Contracts: Open-source and verified
  • Position NFTs: Integrate into your DeFi protocol
  • Analytics Tools: Build dashboards and bots
  • Custom UIs: Create your own trading interface

Developer documentation and integration guides are coming soon.

Is there a points or rewards system?​

Yes! LemonMarkets features a Points Leaderboard that rewards active traders:

How Points Work:

  • Points are earned based on trading volume
  • Higher volume = more points
  • Leaderboard tracks top traders across all perpified markets

Leaderboard Benefits:

  • Compete for top positions
  • Recognition in the community
  • Potential future rewards and airdrops
  • Exclusive perks for top traders

Strategy:

  • Consistent trading activity earns more points
  • Volume across all markets counts
  • Track your ranking in real-time

What's the roadmap for perpification?​

Our perpification vision:

  • Q1 2026: Perpify top 100 crypto assets + major stocks
  • Q2 2026: NFT collection perpification + commodities
  • Q3 2026: Exotic assets (prediction markets, pre-IPO)
  • Q4 2026: 10,000+ perpified markets across all asset classes
  • Beyond: Full permissionless perpification - anyone can perpify anything

Safety & Security​

Is LemonMarkets audited?​

Our smart contracts undergo rigorous security review:

  • Multiple professional audits
  • Continuous security monitoring
  • Bug bounty program
  • Open-source code for community review

Audit reports and security details will be published as they become available.

What are the main risks?​

Smart Contract Risk: Bugs or exploits in protocol code

Oracle Risk: Price feed manipulation or failure

Liquidation Risk: Market volatility causing position liquidation

Counterparty Risk: In PvP markets, your gain is another trader's loss

Always trade responsibly and never risk more than you can afford to lose.

How are perpified markets protected from manipulation?​

Multiple safeguards:

  • Decentralized oracles prevent single-source manipulation
  • Price deviation limits halt trading if oracle prices seem wrong
  • Time-weighted averages smooth out short-term volatility
  • Insurance pool covers unexpected events
  • Liquidation mechanisms prevent cascading failures

What happens if an oracle fails?​

If an oracle for a perpified market fails or shows anomalous data:

  1. Trading automatically pauses for that market
  2. Positions remain safe and locked
  3. Emergency oracle switched to backup feed
  4. Trading resumes once reliable pricing restored
  5. Insurance pool covers any losses from oracle failure
Questions?

For basic questions, see the FAQ. For trading help, check the Trading Guide.