Pains and motivations

GT3 is a next-generation DEX capable of addressing some of the most well-known issues in the ecosystem of AMMs and liquidity pools:

1. Problems Associated with Conventional Liquidity

We define conventional liquidity as that generated in Uniswap v2 models (where liquidity providers deposit their LP tokens into a farming contract to receive incentives) and v3 models (where liquidity providers receive NFTs associated with their liquidity positions along the bonding curve, earning incentives if they are within range).

These methods of liquidity creation have proven to fail in the traditional sense, as they create very difficult-to-solve problems:

• Token value loss is directly proportional to the inflation generated.

• Attraction of mercenary liquidity, with constant and periodic withdrawals.

• Misalignment of incentives between projects and LP holders: projects want to capture liquidity and value (price), while LP holders wish to earn commissions by going short via farming (v2) or fees (v3), decapitalizing the projects in terms of price and TVL.

• There is low liquidity for most "non-rockstar" protocols, and TVL cannot be increased without falling into the previous problem spiral.

• There is difficulty sustaining the model in the long term, as token issuance for incentives always has a set end date.

2. Problems Associated with Low-Capitalization Tokens

Most tokens launched by companies have a reach limited to their community.

The reality is that, after analyzing the most relevant tokens in the ecosystem, very few projects have been able to thrive in terms of price and TVL; the vast majority have lost a large part of their capitalization. They cannot increase their TVL by themselves, thus not generating incentives for trading, and they fall into a complicated spiral.

• The project is unable to increase the size of its liquidity pool,

• This causes price impacts to be significant for increasingly more prominent trades,

• As a result, traders choose not to make such trades to avoid penalties,

• And thus the tokens are neither bought nor sold.

This prevents projects from growing and leaves them with very small TVL and accurate liquidity figures.

Helping these tokens capture liquidity and value through GT3 would be simple for us, as many of them are connected to the Tutellus ecosystem (RNT, FIT, TURIN, ZHT, etc.) or accessible through the Polygon ecosystem.

GT3: A Next-Generation DEX That Solves the Previous Problems

In GT3, unlike a classic DEX or AMM,

• There is no concept of Staking or Farming, but rather GT3 lockers (who decide which pools should be incentivized) and LP holders (who provide liquidity to the pools).

• Projects incentivize rewards for the GT3 lockers who support their liquidity pools during each cycle (1 month).

• GT3 lockers are users with GT3 who stake it to create xGT3, a synthetic token that gives them voting power and the ability to receive fees and incentives.

• GT3 lockers vote each cycle on which pools they prefer to incentivize: through game theory, more incentives will be directed to these pools for the LPs, leading to larger pool sizes. This aligns the incentives of GT3 lockers with those of the projects and, consequently, the LP holders.

• GT3 lockers will receive fees from all trades in the pools they support and rewards from the projects. According to game theory, the pools with the most liquidity will be able to execute the most trades (and thus generate the most fees), as they will offer better pricing conditions.

• LP holders will receive the incentives generated from the GT3 vault.

In our DEX model, we believe the incentives of all stakeholders are sufficiently well-aligned for both the GT3 token and the listed tokens to capture value and liquidity. Through game theory, the projects will compete in each cycle to see which becomes the most relevant to NFT holders in terms of attracting liquidity."