Liquidity Distribution 
The “KPI Details” portion of this proposal represents the total amount of depth that [AlphaMint] agrees to provide across all exchanges that [ABC] is listed on. The distribution of depth on each exchange is to be determined by [AlphaMint]. KPIs are quoted by [AlphaMint] as a percentage of loan value, which accounts for fluctuations in [ABC] price.

Minimum & Maximum KPIs
[AlphaMint] has provided minimum and maximum values for all liquidity KPIs to ensure reasonable depth & spread targets in the event of large token movements. For example, even if [ABC]’s price dropped 99%, [AlphaMint] would be obligated to provide at least:
 
[Minimum, Depth 50 bps] worth of orders within 0.50% of each direction from the midpoint  
[Minimum, Depth 100 bps] worth of orders within 1.00% of each direction from the midpoint  
[Minimum, Depth 200 bps] worth of orders within 2.00% of each direction from the midpoint  
A maximum spread of [Maximum, Spread].


Similarly, even if [ABC]’s price increased by 10,000%, [AlphaMint] would be obligated to provide at most: 

[Maximum, Depth 50 bps] worth of orders within 0.50% of each direction from the midpoint  
[Maximum, Depth 100 bps] worth of orders within 1.00% of each direction from the midpoint  
[Maximum, Depth 200 bps] worth of orders within 2.00% of each direction from the midpoint  
A maximum spread of [Minimum, Spread].

Order Book Dominance Clause
[AlphaMint]’s obligations to meet the liquidity KPIs will be voided if [AlphaMint] ever represents greater than or equal to [Order Book Dominance] of the total depth provided by all marketplace participants within 2.00% of each direction from the midpoint price across all exchanges that [ABC] is traded on.

This section provides more details on loan structure and option pricing. The [Total Loan Quantity, Tokens] [ABC] loan extended to [AlphaMint] is divided into [Number of Tranches] “tranches”. Each “tranche” has its own distinct structure and pricing.  

Tranche 1 (Fixed):
[Tranche 1 Quantity] [ABC] loan to [AlphaMint]. [AlphaMint] has the option, but not obligation, to purchase this [ABC] at a fixed price. The price is equal to [% Fixed Priced, Tranche 1] of [Current Token Price]. If exercised, [AlphaMint] would send [Project Name] [Tranche 1 Proceeds, Fixed] in stablecoins.

Tranche 2 (Dynamic):
[Tranche 2 Quantity] [ABC] loan to [AlphaMint]. [AlphaMint] has the option, but not obligation, to purchase this [ABC] at a price equal to a [% Dynamic Price, Tranche 2] of [ABC]’s time weighted average price (“TWAP”) within the [TWAP Threshold, Tranche 2] day period immediately following [Time Period, Tranche 2] of this engagement. For example, if [Token Ticker]’s TWAP price is [Token Price w/ 2x], then the option will be priced at [Tranche 2 Price w/ 2x]. If exercised, [AlphaMint] would send [Project Name] [Tranche 2 Proceeds, Dynamic] in stablecoins.

Tranche 3 (Dynamic):
[Tranche 3 Quantity] [ABC] loan to [AlphaMint]. [AlphaMint]] has the option, but not obligation, to purchase this [ABC] at a price equal to a [% Dynamic Price, Tranche 3] of [Token Ticker]’s time weighted average price (“TWAP”) within the [TWAP Threshold, Tranche 3] day period immediately following [Time Period, Tranche 3] of this engagement. For example, if [ABC]’s TWAP price is [Token Price w/ 2x], then the option will be priced at [Tranche 3 Price w/ 2x]. If exercised, [AlphaMint] would send [Project Name] [Tranche 3 Proceeds, Dynamic] in stablecoins.

Tranche 4 (Fixed):
[Tranche 4 Quantity] [ABC] loan to [AlphaMint]. [AlphaMint] has the option, but not obligation, to purchase this [Token Ticker] at a fixed price. The price is equal to [% Fixed Priced, Tranche 4] of [Current Token Price]. If exercised, [AlphaMint] would send [Project Name] [Tranche 4 Proceeds, Fixed] in stablecoins.

In sum, if [AlphaMint] chose to repay the entirety of the [Total Loan Quantity, Tokens] [ABC] loan in stablecoins, [Project Name] would receive a total of [Total Proceeds], based on the hypothetical price performance of [ABC] described above. Note, [AlphaMint] has the option to purchase only a portion of the loan, or none at all. [AlphaMint] bears no obligation to repay the loan in stablecoins and may choose to return the [Total Loan Quantity, Tokens] [ABC] loan instead.

At the end of the [Loan Tenor Months] term, [AlphaMint] can close out the loan by either returning [Total Loan Quantity, Tokens] [ABC], or paying stablecoins to [Project Name]. In other words, [AlphaMint] has the option, but not obligation, to purchase [Total Loan Quantity, Tokens] [ABC] at the end of the [Loan Tenor Months] term. All details are outlined in the “Loan Details” portion of the proposal.

The estimated price at which [AlphaMint] can purchase each [Token Ticker] is [Weighted Purchase Price], which represents [Weighted Option Premium %] of [ABC]’s current price. This means that if [AlphaMint] chose to exercise its option to repay the loan in stablecoins, [Project Name] would receive [Weighted Purchase Amount], instead of [Total Loan Quantity, Tokens] [ABC]. The exact price at which [AlphaMint] can purchase [ABC] is nuanced, and described further in the section “Detailed Option Structure & Pricing” below.

In exchange for the loan, [AlphaMint] will be obligated to meet “Depth” and “Spread” requirements for [ABC]. These requirements are referred to as key performance indicators, or “KPIs” and are provided in the “KPI Details” portion of the proposal. The KPIs will vary based on (1) the caliber of exchange [ABC] is listed on, and (2) the price of [ABC]. If [ABC] is listed on higher quality exchanges, liquidity KPIs will be more favorable, while listings on lower quality exchanges will yield less favorable KPIs. Similarly, if the price of [ABC] increases or decreases, then the liquidity KPIs will follow suit.

For example, if [ABC] is listed on Binance or OKX, then [ABC] would be considered a “Tier 1”. At the current price of [Current Token Price] per [ABC], [AlphaMint] would be obligated to maintain liquidity KPIs of:

[Tier 1, Depth 50 bps] worth of orders within 0.50% of each direction from the midpoint  
[Tier 1, Depth 100 bps] worth of orders within 1.00%  of each direction from the midpoint  
[Tier 1, Depth 200 bps] worth of orders within 2.00%  of each direction from the midpoint  
A maximum spread of [Tier 1, Spread].

If the price of [ABC] increased by 100% to [Token Price w/ 2x], then [Market Maker Name]’s depth KPIs would increase to:

[Tier 1, Depth 50 bps w/ 2x Px] worth of orders within 0.50% of each direction from the midpoint  
[Tier 1, Depth 100 bps w/ 2x Px] worth of orders within 1.00% of each direction from the midpoint  
[Tier 1, Depth 200 bps w/ 2x Px] worth of orders within 2.00% of each direction from the midpoint  
A maximum spread of [Tier 1, Spread].

If this proposal is selected, [Project Name] must loan [AlphaMint] [Total Loan Quantity, Tokens] [ABC] for a period of [Loan Tenor Months] months. At the end of the [Loan Tenor Months] term, [AlphaMint] can close out the loan by either returning [Total Loan Quantity, Tokens] [ABC], or paying stablecoins to [Project Name].

During this [Loan Tenor Months] month term, [AlphaMint] would have contractual obligations to provide liquidity for [ABC]. This liquidity would serve to improve the user experience for other buyers & sellers, promote organic trade volume, and facilitate efficient price discovery for [ABC].