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This guide explains the fundamental concepts of Vita Finance. If you’re already familiar with DeFi, jump to our technical docs.

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Core Concepts Overview

Concentrated Liquidity

Deploy capital within specific price ranges for maximum efficiency

Order Book (CLOB)

Trade with limit orders on our central limit order book

NFT Positions

Each liquidity position is a unique, tradeable NFT

xVITA Staking

Stake VITA tokens to earn protocol revenue and governance rights

Session Rewards

Weekly reward distribution based on time-weighted contributions

USDC Markets

All CLOB pairs quoted in USDC for stable trading

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1. Two Independent Trading Systems

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AMM vs CLOB

Vita Finance offers two separate and independent trading systems:
Type: Automated Market Maker
Execution: Instant
Pricing: Algorithmic (x*y=k curve)
Liquidity: Provided by LPs in poolsBest for:
  • Quick swaps
  • Small to medium trades
  • Passive liquidity provision
AMM and CLOB are completely separate systems with no shared liquidity. They operate independently with their own pricing mechanisms.

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Trading Flow Diagram

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2. Automated Market Maker (AMM)

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How Swaps Work

Swap Process Flow
  1. User → Sends Token A
  2. Vita Pool → Calculates Rate
  3. Vita Pool → Sends Token B
  4. LPs + Protocol → Collects Fee
Each swap incurs a default 0.3% fee. The distribution is configurable through protocol_fee_rate and community_fee_rate parameters.

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3. Central Limit Order Book (CLOB)

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Order Types

Set your exact buy or sell price:
  • Order executes only at your price or better
  • No slippage
  • May not execute immediately
Execute immediately at best available price:
  • Instant execution
  • Takes liquidity from order book
  • Subject to slippage on large orders
All CLOB pairs are quoted in USDC:NEAR/USDC VITA/USDC BTC/USDC ETH/USDCThis provides stable pricing and easy comparison across markets.

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CLOB vs AMM Comparison

FeatureAMMCLOB
ExecutionInstantWhen orders match
PricingAlgorithmicOrder-driven
SlippageAlways presentNone on limit orders
LiquidityPooledIndividual orders
Best forQuick tradesPrecise execution

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4. Liquidity Provision

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Understanding Ticks

Vita uses a tick-based system where each tick represents a 0.01% price change: 
price = 1.0001^tick

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Price Ranges Explained

When current price is within your range:
  • ✓ Earning trading fees
  • ✓ Holding both tokens
  • ✓ Exposed to impermanent loss
When price moves outside your range:
  • ✗ Not earning fees
  • ✗ Holding only one token
  • ✗ No additional IL until back in range

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Capital Efficiency Calculation

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Example: NEAR/USDC pool at $5.00

  • Wide range (1−1-25): ~4x efficiency
  • Medium range (4−4-6): ~25x efficiency
  • Narrow range (4.90−4.90-5.10): ~100x efficiency
  • Ultra narrow (4.99−4.99-5.01): Very high efficiency
Narrower ranges offer higher efficiency but require more active management and carry higher impermanent loss risk.

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5. VITA & xVITA Tokens

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VITA Token

The native governance and utility token of Vita Finance:
1

Utility

  • Pay for protocol services
  • Governance voting
  • Liquidity mining rewards
  • Fee discounts
2

Technical Details

Decimals: 18 (not 24 like NEAR)
Total Supply: 100,000,000 VITA
Contract: [TBD]

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xVITA Token

xVITA represents staked VITA with additional benefits: 
// xVITA characteristics
{
  revenueShare: "Protocol and community vault distributions",
  governanceWeight: "1 xVITA = 1 vote",
  farmingBoost: "Up to 2.5x maximum boost",
  redemptionOptions: "15-180 days",
  decimals: 18 // Same as VITA
}

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Redemption Mechanics

The redemption rate follows a linear curve:
PeriodReturn
15 days50% (emergency exit)
180 days100% (maximum value)
Formula: 50% + (days - 15) / 165 × 50%

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6. Fee Structure

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Trading Fees

All AMM pools use a default 0.3% trading fee (3000 in basis points):

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Fee Distribution

Fees are distributed through configurable parameters:
  • protocol_fee_rate: Protocol treasury portion
  • community_fee_rate: Community vault portion
  • Remaining: Liquidity providers
FEE_RATE_DENOMINATOR_VALUE = 1,000,000 (for precise calculations)

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7. Session-Based Rewards

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How Sessions Work

Vita uses a 7-day session system for fair reward distribution
// Session timeline
const session = {
  duration: 7 * 24 * 60 * 60, // 7 days in seconds
  startTime: "Monday 00:00 UTC",
  endTime: "Sunday 23:59 UTC",
  claimPeriod: "Anytime after session ends"
};

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Reward Calculation

Your rewards depend on:

1

Time-weighted balance
How long you held positions

2

Session performance
Total fees generated

3

Your share
Your proportion of total liquidity
// Simplified reward formula
userReward = (userLiquidity * timeInSession * sessionFees) / totalLiquidity

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8. NFT Position System

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Why NFTs?

Each liquidity position is an NFT because:

Uniqueness

Every position has unique parameters (range, liquidity, fees)

Transferability

Positions can be sold or transferred without closing

Composability

Use positions as collateral in other DeFi protocols

Management

Easy tracking and management of multiple positions

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Position Metadata

{
  "tokenId": 12345,
  "pool": "NEAR-USDC",
  "owner": "alice.near",
  "tickLower": -665454,  // MIN_TICK
  "tickUpper": 831818,   // MAX_TICK
  "liquidity": "1000000000000000000",
  "feeGrowthInside0": "500000",
  "feeGrowthInside1": "300000",
  "tokensOwed0": "50",
  "tokensOwed1": "10"
}

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9. Boost Mechanics

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Advanced Boosting System

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xVITA Boost System

xVITA Boost
Sigmoid curve function based on your xVITA holdingsMaximum boost: Up to 2.5xThe boost depends on your share of total xVITA in the protocolBoost calculation uses a complex sigmoid function that considers:
  • Your xVITA balance
  • Total xVITA supply
  • Your proportional share
  • Time-weighted average balance
The maximum achievable boost is 2.5x. This applies to farming rewards and is calculated per session.

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10. Impermanent Loss

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Understanding IL in Concentrated Positions

Concentrated liquidity can amplify impermanent loss. The narrower your range, the higher the potential IL.

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IL Scenarios

  • Normal IL applies (same as traditional AMM)
  • Offset by higher fee earnings
  • Generally profitable if volume is high

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Interactive Tools

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Explore Our Tools

Fee Calculator

Calculate your expected returns based on liquidity and volume

Price Range Simulator

Visualize different price ranges and their efficiency

Expected Returns Calculator

Estimate your APR including fees and rewards

Interactive Concepts

Learn concepts through interactive visualizations

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Next Steps

Now that you understand the core concepts:

Start Trading

Put your knowledge into practice

Deep Dive: Liquidity

Master concentrated liquidity strategies

Explore xVITA

Learn about staking and governance

Developer Docs

Build on top of Vita
Questions? Join our Discord where our community and team are happy to help!