Spread refers to the range of difference between max and min prices for an asset. In DeFi, this is related to the possible variance of price from the prices quoted by our oracle source.
To avoid unnecessary spread and slippage on stablecoins, Fulcrom applied a mechanism to maintain stablecoin swap price at 1 usd when executing positions. For example, if the USDC price is close to $1, you will be opening position with rate at usdc = $1
However, to ensure trades are aligned with market situations, Fulcrom will also apply the spread mechanism onto stablecoins, same as the indexed tokens.
When stables’ market price deviates from $1 (i.e. >1%), spread mechanism will be applied on Fulcrom, transactions involving stables will follow market prices with spread.
Entry price in long positions = max price
Entry price in short position = min price
Long position: Liquidation will happened when market reaching the Min price
Short position: Liquidation will happened when market reaching the Max price
Slippage may occur when opening positions.
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