Levana Well-funded Perps is a protocol for perpetual swaps-leveraged trading contracts-that is designed to handle risk while creating advantages for both traders and liquidity providers.

For traders, Levana keeps every position “well-funded,” so the maximum possible profit is determined and secured ahead of time. By doing so, it removes the risk of bad debt and insolvency, improving overall confidence.

Liquidity providers, meanwhile, earn yield for bearing exposure to sudden market swings. They provide capital as collateral and receive a fee that includes a risk premium.

The protocol is built to address shortcomings seen in current perpetual swap approaches, including the virtual AMM. While those systems use intricate methods to maintain price stability, they still face constraints and can become hazardous during periods of high volatility.

By isolating different trading pairs and running a decentralized liquidity market, Levana lowers the chance that problems spill over across markets. It also supports scaling into additional blockchain networks.

In short, Levana’s perpetual swaps framework aims to deliver a dependable and secure venue for traders and liquidity providers. It promotes fair settlement, reduces key risks, and enables building further financial protocols on top of tokenized positions.