On-Demand Liquidity

Learn about 'on-demand liquidity' and how Bolt Liquidity optimizes capital deployment for LPs.

Bolt's architecture enables on-demand liquidity, a feature that maximizes capital efficiency for liquidity providers (LPs).

Unlike traditional AMMs, which require large amounts of pooled assets to minimize slippage across all possible trade sizes, Bolt allows LPs to deploy funds only to cover the maximum anticipated trade size.

This means liquidity is allocated precisely where it's needed, reducing idle capital and improving returns for LPs. As a result, trades can be executed with zero slippage and optimal CEX-like pricing, even with lower overall liquidity in the pool.

How It Works

Single-Sided Pools

• LPs deposit a single asset into Bolt pools (per Outpost)

• No need to pair assets or maintain specific ratios eliminating half of capital requirements

• Flexibility to provide liquidity for multiple quote assets

Capital Efficiency

• No idle capital in pools, only deposit enough LP to actually trade against rather than a surplus as typically expected by an AMM

• Users trade against entire pool depth without slippage

Benefits

For Liquidity Providers

• Reduced capital requirements

• No impermanent loss exposure

• Better returns on deployed capital

• Flexible liquidity management

For Traders

• Zero slippage execution

• Guaranteed execution price

• Deep liquidity for large trades

• CEX-like trading experience

Capital Efficiency Example A traditional AMM might need $10M in liquidity to handle a $1M trade with acceptable slippage. Bolt can handle the same $1M trade with just $1M in liquidity, as funds are deployed precisely when needed.