Liquidity Rewards

Aura pays makers daily to keep books tight. Post resting limit orders near a market’s true midpoint and you earn a share of that day’s USDT reward pool. Quoting on the book is the only qualification, so there is nothing to sign up for.

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The pool

Unlike creator and referral fees, liquidity rewards do not wait for market resolution. They are scored per day and paid the next day.

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What the program rewards

The scoring is built to pay for liquidity that is actually useful to traders:

• Tight quotes, close to the midpoint
• Two-sided quotes rather than one-sided
• Liquidity that persists through the day rather than appearing in bursts
• Size that a real trader could actually hit

And built to not pay for liquidity that only exists to farm:

• Dust orders that never intend to fill
• Quotes parked far from the midpoint
• One-sided quoting, which is penalized rather than banned

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The adjusted midpoint

Scoring measures your distance from the midpoint, so the midpoint has to be manipulation-resistant. Aura computes it after filtering out dust orders below a minimum incentive size. Without that filter, a maker could post a tiny order at an extreme price to drag the midpoint towards their own resting quotes and score as if they were tight. The filter removes that.

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Scoring

Orders are scored by distance from the adjusted midpoint and by size. Closer quotes earn sharply more, because the score falls off with the square of the distance. Equation 1: order position score $$S(v,s) = \left(\frac{v - s}{v}\right)^2 \cdot b$$ Equation 2: book one points $$Q_{one} = \sum S(v, Spread_m) \cdot BidSize_m + \sum S(v, Spread_{m'}) \cdot AskSize_{m'}$$ Equation 3: book two points $$Q_{two} = \sum S(v, Spread_m) \cdot AskSize_m + \sum S(v, Spread_{m'}) \cdot BidSize_{m'}$$ Equation 4: two-sided score If the midpoint is between 0.10 and 0.90: $$Q_{min} = \max\!\left( \min(Q_{one}, Q_{two}),\ \max(Q_{one}/c,\ Q_{two}/c) \right)$$ If the midpoint is below 0.10 or above 0.90: $$Q_{min} = \min(Q_{one}, Q_{two})$$ Equation 5: normalize across makers $$Q_{normal} = \frac{Q_{min}}{\sum Q_{min}}$$ Equation 6: sum across the epoch $$Q_{epoch} = \sum Q_{normal}$$ Equation 7: final share of pool $$Q_{final} = \frac{Q_{epoch}}{\sum Q_{epoch}}$$ Daily reward for a maker $$Reward = Q_{final} \cdot DailyPool$$

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Reading the formula

Three things do most of the work:

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Practical approach

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