Feature Suggestion: Automated LP Operator Bot for Meteora

Overview:

The proposed feature introduces an Automated Liquidity Provider (LP) Operator Bot for Meteora. This bot is designed for traders who engage in liquidity provision, particularly in pairings like SOL - USDC and SOL - USDT. The bot automates the management of medium-sized positions within a tightly controlled price range, optimizing liquidity provision and reducing the need for constant monitoring.

Key Features:

Automated Range Monitoring:

The bot constantly monitors the selected liquidity pool to ensure that the position remains within the pre-set price range (e.g., -3% to +3% of the current price).

Automatic Position Adjustment:

When the price moves out of the specified range, the bot automatically closes the existing position and opens a new one with the same parameters but adjusted to the new market price. This ensures continuous optimal positioning within the liquidity pool.

Configurable Position Parameters:

Users can set the size of the position (e.g., $50,000 to $100,000) and the desired price range for operation. This allows for tailored liquidity provision strategies based on individual risk tolerance and market assessment.

Real-time Analytics and Reporting:

The bot provides real-time analytics on the performance of the liquidity position, including fees earned, price movements, and range efficiency. This aids in making informed decisions about position adjustments.

Example Scenario:

A trader regularly operates in the SOL - USDC pairing, finding that medium positions ($50k - $100k) within a -3% to +3% range yield the best results. To optimize this strategy without the need for constant monitoring, the trader utilizes the Automated LP Operator Bot to manage these positions. The bot ensures the position stays within the profitable range and adjusts it as needed, maximizing efficiency and returns.

Benefits:

Time Efficiency:

Reduces the need for continuous manual monitoring of liquidity positions.

Optimized Liquidity Provision:

Maintains positions within a profitable range, potentially increasing fee earnings.

Stress Reduction:

Automates the tedious task of range watching and position adjustment, allowing traders to focus on broader strategies.

Enhanced Decision Making:

Provides valuable insights through real-time analytics, assisting in strategic adjustments.

Implementation Considerations:

User-Friendly Interface:

An intuitive setup for defining and adjusting position parameters.

Safety Protocols:

Robust security measures to protect against unauthorized access and operational errors.

Notification System:

Alerts and notifications for key events like position adjustments, range exits, and performance summaries.

This feature aims to revolutionize liquidity provision on Meteora by automating critical aspects of LP operation, thereby enhancing profitability and reducing the manual effort required in managing medium-sized positions within narrow ranges.

5 Likes

I love this system. And what’s happening here at meteora, building a strong community on value.

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Thank you for your feedback. This feature came as a product of my own experience operating LPs. This feature would revolutionize the way I interact with DLMMs, and allow for a more significant part of my portfolio to be allocated to Meteora.

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Dude I love this. Definitely needed in the space. It solves a few issues when trading and we need this kind of tools for us to bring more liquidity in. Well done.

2 Likes

Thank you for sharing your feedback! I’m happy to see more people like this. It’s a feature i haven’t seen implemented yet, but have been eager to work with.

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Good idea, i run bots on solana, and this makes sense on Meteora.

This idea works on solana cause of low fees, so its worth it to keep changing the range.

Also normaly lower range = higher fees (higher rewards)

So with this, you can have a veeery narrow range, maximing rewards and the bot keeps adjusting it

2 Likes

I’m glad more people get this! Hopefully, we can see this built and implemented soon!

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Absolutely love this. Ability to change some of the variables of the bot would also be very welcome.

2 Likes

yes, i wanted to ask about implementing this type of system/bot in one of the x spaces but did not get the chance to do it.

2 Likes

Thank you ser. Imo it needs to be “fully” customizable, so the operator can still earn its advantage, and not be gridlocked in a “safe-mode”

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Given this would be a met-built thing, I reckon the implementation would have to follow some strict guidelines.

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This is a pretty great proposal. Are there others developers interested in building something like this? We’d be down to support this.

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Regarding the build, I am on it.

I appreciate the positive feedback and your support! I have a clear picture of how we can unlock the potential of DLMMs for the regular user. lots to discuss.

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amazing, let me know how we can help. Would also love if you could make it to our DLMM strategy session tomorrow to discuss what strategies make sense for this automated LP operator bot.

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Thank you for the invitation, It would be my pleasure. I’ll check on my schedule to see if the time works.

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@og77 @ben
I have built a typescript bot that currently does this and has been running on aws, although I had to pause and work on the dynamic range automation and filter pools using python, so far I am studying on filtering the best pairs to automate dllm and testing it. Would love to collaborate and discuss with experts as I myself is new to AMM, but this was the first thing that came into my mind when I visited Meteora DLLM pool. How can I get in touch for support?

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Also a dataframe for filtering pools and il calcualtion:

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Might be easier to chat in developer-support in discord. I think the MM bot is probably most useful for high volume pairs with low fees. So the SOL-USDC 1/0.01% binstep/basefee pool would prob be the most hardest testing ground for the MMing bot.

We’ve updated how we calculate IL to be based on being able to return back the starting amounts.

So your starting amount could be split 100 SOL / 10k USDC, or even single asset, say 200 SOL. If we use 200 SOL and we want to calculate our P&L, we look at our current balances + fees, and then take any USDC and calculate how much SOL we would get back if we swapped on Jupiter. Anything above 200 SOL would be our profit.

You can also try to estimate a price range where you can rebalance without loss based on how much fees you’ve accumulated.

I wouldn’t call myself an expert, but, I think the key decisions for a strategy is determining your price range and deciding when to rebalance.

Anyway, we’d love to support, collaborate and learn with anyone building a MMing bot!

awesome work @royce ! We are working towards a range of DLMM-centric products on #iamded . You can find us within the Meteora Discord. Give us a shout! the team will reach out and we can chat about working together!