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waterTVL ≠ Liquidity

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How should we think about TVL for Bolt?

While TVL is a common signal for AMM-based liquidity sources, Bolt’s architecture works differently, and TVL is not a strong proxy for executable liquidity.

Bolt functions closer to an RFQ / prop-AMM model rather than a curve-based AMM:

  • Pricing is deterministic and anchored to an oracle, not shaped by a bonding curve.

  • Execution does not depend on pool depth in the traditional sense, only on whether the pool has sufficient inventory to service the submitted trade.

  • Liquidity is single-sided, and market-making logic hedges externally and replenishes on-chain inventory once it drops below a minimum threshold.

Because pricing is decoupled from depth, a pool with $100k of inventory can execute a $100k trade at zero slippage, assuming sufficient inventory is available.

There is:

  • No curve-based price deterioration as trade size increases

  • No dependency on deep, passive liquidity to maintain price quality

The primary constraint is inventory availability, not depth-induced price movement.

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TVL in Integration Decisions

When evaluating a new liquidity source, integration partners often rely on TVL as a signal of available liquidity and expected execution quality. In curve-based AMMs, higher TVL generally correlates with lower slippage and better user outcomes, making it a reasonable input for integration decisions.

With Bolt, this assumption does not apply. Pricing is deterministic and oracle-anchored, and execution quality does not degrade as liquidity is consumed. As a result, TVL does not reliably reflect slippage behavior or execution quality for users.

When assessing a Bolt integration, partners should instead evaluate available inventory at execution time, deterministic pricing guarantees, and inventory replenishment mechanics. These factors more accurately indicate Bolt’s ability to deliver consistent, zero-slippage execution independent of passive liquidity depth.

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