Market-Making Scripts for OpenBook
Problem to Solve:
Market Making is critical for infusing liquidity in orderbooks, increasing efficiency for any exchange. After the demise of FTX, OpenBook (Fork of Project Serum) has been facing a liquidity crunch due to a lack of market makers. Alameda was one of the most active market makers.
Without active market making, spreads won’t be tight, leading to inefficient prices for all market participants.
Possible Solution:
Provide liquidity on OpenBook by placing bids/asks on opposite sides of the book and earning a spread.
The SDKs can be utilized to pay a 2 bps fee for taker orders and pay 0 bps to make, i.e., market-making executions will be cost-free.
A few features of the bot can be:
1) It should be easily configurable by anyone, plug and play.
2) It should place both ask and bid orders around some mid-price.
3) The spread should be configurable.
4) It should automatically rebalance and be able to maintain 24/7 liquidity
Resources:
Related Ideas
