🚂Liquidity Engine
Overview
MemeMarket isn’t just another prediction platform, it’s a revolutionary liquidity engine powered by $MFUN. By fusing bonding curves, auto-balancing risk-weighted adjustments, and liquidity rewards, the system ensures traders win, liquidity deepens, and $MFUN demand compounds.
To encourage early trading, MemeMarket implements risk-weighted rewards for initial liquidity providers. Early adopters are fairly compensated for higher risk exposure, fostering deeper liquidity from inception. Exit mechanics discourage last-minute withdrawals that could create disproportionate risk for remaining participants, preserving system stability. Markets bootstrap quickly, deepen as participation grows, and remain liquid by rewarding both winners and losers.
MemeMarket’s liquidity system forms the backbone of the platform’s trading infrastructure, turning fragmented meme speculation into a unified capital network. At its core are Dynamic Prize Pools that expand with participation and bonding curve mechanisms that align incentives across entry, exit, and liquidity provisioning. Together they connect traders, liquidity providers, stakers, and AI users in a self‑reinforcing loop, where every action compounds value across the protocol. These two elements work hand in hand: prize pools manage distribution of capital and rewards in each cycle, while bonding curves align incentives so that early participation, sustained liquidity, and graceful exit
By embedding incentives directly into trading flows, MemeMarket bootstraps early markets quickly, sustains depth as they grow, auto-balances risk, and keeps long‑term participants engaged. The result is a closed‑loop liquidity engine powering enduring protocol economics.
MemeMarket’s Phased Liquidity Architecture
For clarity, references to liquidity provisioning throughout this whitepaper refer specifically to our Phase One Dynamic Prize Pool architecture model, rather than to conventional AMM frameworks. This initial design is a deliberate strategic choice: by simplifying market mechanics, we accelerate user onboarding, lower barriers for early traders, and enable faster liquidity formation at scale. As the protocol matures, MemeMarket will advance toward an AMM architecture with decentralized orderbooks; unlocking greater liquidity depth, more precise position management, and enhanced capital efficiency. This future evolution not only reinforces MemeMarket’s long-term scalability, but also positions the platform to extend well beyond its initial meme coin focus, laying the groundwork for a composable, multi-market infrastructure capable of supporting broader digital asset classes. With this phased architecture, MemeMarket balances immediate market readiness with a clear trajectory toward protocol sophistication and ecosystem leadership.
In the following sections, we explore how the combined mechanics of prize pools and bonding curves drive MemeMarket’s enduring protocol economics.
Dynamic Prize Pools
Traders’ liquidity flows into event-based prize pools that expand as participation grows.
Early traders earn risk-weighted rewards, fairly compensating higher risk and boosting initial liquidity.
Exit mechanics deter last-minute withdrawals, preserving pool stability and protecting participants.
Pools adjust dynamically to sustain engagement across market cycles.
Liquidity Incentives
$MFUN rewards scale with liquidity inflows (SOL and other assets).
Early contributors are rewarded, catalyzing rapid bootstrapping.
As participation compounds, prize pools expand and depth is sustained.
Multi-Asset Liquidity Support
While starting with SOL markets, MemeMarket expands to stablecoins, BONK, and other meme-native assets.
This diversifies liquidity streams and strengthens MemeMarket’s hub position.
Automatic Liquidity Cycling
Liquidity remains within the system.
Flows through market rounds, treasury, staking, and AI-access tiers.
Creates a sustainable capital loop that fuels recurring engagement.
Bonding Curve Mechanics Explained
MemeMarket employs three main bonding curves, each addressing a different stage of market participation:
🔹 Bonding Curve 1: Entry → Prize Pool Risk Weighted Adjustment
Rewards early traders who take on higher risk.
Unlocks risk-weighted bonuses for first liquidity providers.
Ensures markets start deeper and stronger from day one.
Computation:
Let:
t = seconds since the round started
T = total market duration (e.g., 1200 seconds = 20 minutes)
Case 1: If the user deposits more than 5 minutes before the market ends:
Case 2: If the user deposits within 5 minutes or less before the market ends:
🔹 Bonding Curve 2: Exits → Prize Pool Risk Weighted Adjustment
Discourages last-minute exits to protect liquidity stability.
Prevents sudden drains and excess risk for remaining participants.
Keeps pools predictable and sustainable over time.
Computation:
Case 1: More than 5 minutes before closure
100% of the withdrawal amount are redeemable ( without 3% of platform fee and 1% of early withdrawal [Exit] fee)
Case 2: Within the final 5 minutes
Only 25% of the of the withdrawal amount are redeemable ( without 3% of platform fee and 1% of early withdrawal [Exit] fee)
🔹 Bonding Curve 3 - $MFUN Liquidity Provisioning Rewards
Rewards both winners and losers with $MFUN, sustaining depth.
Scales rewards as more liquidity flows in.
Early LPs are incentivized to bootstrap markets.
The following formula outlines how the required deposit threshold evolves over time and how rewards are distributed based on the total weekly wager volume.
Allocation: 29.5% of total supply (295,000,000 $MFUN) reserved for community LP/trader rewards, streamed over 30 months.
Each week the protocol can distribute up to 500,000 $MFUN.
Payouts depend on that week’s total trading volume (deposits + exits).
Initial Threshold: The initial threshold for reaching the maximum reward pool is $100,000 in total weekly wager volume
Monthly Growth of the Threshold: This initial threshold will increase by a 10% growth each month, ensuring that the trading volume requirement grows over time to encourage sustained participation.
If the target is met, the full 500,000 $MFUN is paid; if not, the reward is prorated to the share of the target reached.
Rewards are calculated weekly and paid at the end of the week, split across active markets in proportion to each market’s volume and each trader's provisioned liquidity.
Step 1: Calculate the Maximum Reward Threshold for Each Month
Step 2: Weekly Token Reward Formula
Where:
T required= Required weekly volume for every week in month m
G= Growth rate of T required (10% per month)
T = Total deposit and exit volume, calculated in USD at the time of each user’s deposit or exit. ( (all converted to USD at the time of transaction)
Rmax= Maximum token distribute = 500,000 tokens every week
Incentive Alignment for Sustainable Growth
MemeMarket aligns incentives across all participant types:
For Traders
Win Pools reward correct predictions.
Looser Pool (liquidity rewards) provides partial rewards for incorrect calls.
For Liquidity Providers
Bonding curve scales $MFUN rewards as liquidity grows.
Continuous incentives sustain depth across markets.
For Stakers
Access treasury rewards, protocol revenue, and premium tiers.
Unlock elevated AI Meme Agent features.
For AI Access
Token-gated tiers tie liquidity incentives directly to platform utility.
For Protocol Growth
Market fees flow into Treasury.
Funds recycled into staking, buybacks, community rewards, and ecosystem reinvestment.
Liquidity Flywheel Dynamics
MemeMarket operates as a closed-loop liquidity engine:
User Activity → Liquidity Pools: Traders and LPs inject capital.
Market Outcomes → Protocol Revenue: Fees generated and rewards distributed.
Treasury Flow → Staking & Buybacks: Protocol revenue reinforces token value.
$MFUN Staking → AI Access: Stakers unlock predictive insights and boosts.
AI Signals → New Market Creation: Predictive intelligence drives new inflows.
Loop Repeats: Scaling protocol depth and value over time.
Asymmetric Trading Mechanics: Outsized Rewards, Managed Risk
MemeMarket’s prediction market engine is designed around asymmetric reward-to-risk profiles, enabling users to pursue substantial upside with measured downside exposure.
This model is central to the platform’s capital efficiency. Rather than linear, fixed payouts, MemeMarket’s Dynamic Prize Pools and bonding curve mechanics amplify rewards for early, contrarian, or high-conviction positions. As liquidity accumulates and markets evolve in real time, the distribution of rewards dynamically adjusts to reflect market risk and potential returns.
Key advantages of MemeMarket’s asymmetric trading structure:
High Upside Potential: Early or contrarian positions benefit from exponential ROI multipliers as market sentiment and liquidity shift.
Cushioned Downside: Thanks to mechanisms like the Looser Pool, participants receive partial yield back even when predictions are incorrect; maintaining engagement and softening risk.
Encourages Active Participation: Traders are incentivized to engage early and often, knowing that well-timed entries can deliver returns far exceeding their initial risk.
Dynamic Risk Calibration: As the prize pool and bonding curve evolve, traders can assess shifting asymmetry in real time and adapt their strategies accordingly.
By embedding asymmetric payoff structures into every prediction round, MemeMarket transforms meme coin volatility from raw speculation into strategically managed opportunity; giving traders a compelling reason to engage consistently while reinforcing sustainable market liquidity.
Building Enduring Protocol Economics
By combining bonding curves, auto-balancing risk-weighted adjustments, and liquidity rewards, MemeMarket transforms fragmented meme speculation into a cohesive liquidity system. Liquidity grows, compounds, and recycles ensuring:
Early adopters are rewarded fairly.
Liquidity remains stable and predictable.
$MFUN demand scales with participation.
Incentives align seamlessly across traders, LPs, stakers, and AI users.
This architecture establishes MemeMarket not only as a prediction platform, but as the core liquidity engine for the meme economy.
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