Every swap leaves a bid behind.
1% of each swap is placed as a buy order just below the price. It never moves. What it buys is destroyed.
Look below the price What stays belowA layer never moves.
When the price goes up, the layers stay where they are and the next ones land higher. When it comes back down, each layer it goes through buys, and what it buys is destroyed.
- The white line is the price.
- Each row of dashes is a layer: ETH waiting to buy.
- A row the price has gone through has bought. What it bought is gone.
Nobody can withdraw it.
Nobody can change the rules.
- These are buy orders. They do not hold the price.
- Most of the resting ETH sits far below the price.
- The money comes from the 1% traders pay. Nowhere else.
- Every swap costs 1.30%: 1.00% becomes a bid, 0.30% goes to liquidity providers.