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The Mitosis Solution to Bridge the Gap

Mitosis is an attempt to empower retail LPs and bridge the gap between different types of LPs. Mitosis seeks to enhance the overall efficiency of the initial liquidity market, benefiting all LPs and providing support for protocol builders.

We introduce Ecosystem-Owned Liquidity (EOL), a novel liquidity model that integrates the strengths of both institutional liquidity and retail liquidity, in addition to its unique features. Below is a brief explanation of how Mitosis works.

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The Mitosis Ecosystem: L1 Chain + EOL

The Mitosis Ecosystem comprises an L1 chain and Mitosis Vaults on each network. For now, let’s focus on the Mitosis Vault.

LPs on various networks deposit their liquidity into the Mitosis Vaults of their choice. The Mitosis Vaults are on every network that Mitosis supports, and LPs can choose any network.

The Mitosis Ecosystem decides how to allocate pooled liquidity across various yield sources. Each Mitosis Vault deposits its liquidity into reward opportunities within its respective network. Here is how the decision-making process unfolds:

The Asset Allocation Governance

Protocols interested in the Mitosis EOL can initiate forum discussions. Proposals include information such as the protocol's description, security profile, and details of its offering.

  • Forum Discussion: All Mitosis participants, including LPs and protocols, can share their opinions in the forum discussion. Based on the proposal, the discussion covers topics such as the protocol's safety and the offering's feasibility.

  • Initiation Proposal: LPs vote on the Initiation Proposal to determine whether the Mitosis Ecosystem will opt-in to provide a portion of EOL to the protocol.

  • Gauge Proposal: If a protocol passes the Initiation Proposal, the protocol enters the list of protocols in the Gauge Proposal. LPs vote on the listed protocols to determine what portion of EOL each protocol will receive.

The Reward Distribution

Based on the result of the Gauge Proposal, the Mitosis Vault distributes its liquidity to the protocols.

The earnings of the EOL accumulate in the Mitosis Vaults. Mitosis distributes rewards to all Mitosis LPs, regardless of the network they chose for their deposits. This approach ensures that all LPs enjoy multi-chain yield exposure.