Liquidity Layer

1 Dynamic Market-Making Model (Dynamic AMM)

Merin’s market-making mechanism combines the LSMR (Logarithmic Scoring Market Rule) with an Adaptive Fee Curve:

• Automatically deepens liquidity during high-volatility events;

• Maintains price stability in less active markets through liquidity incentive pools;

• Supports a cross-event Margin Pool model to enable capital sharing across multiple markets.

At the formula level, Merin’s pricing model is defined as:

where α is a dynamically adjusted risk-sensitivity coefficient controlled by AI, automatically optimized based on market sentiment, trading volume, and volatility.

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2 Cross-Market Liquidity Aggregation

The Merin Flow Engine allows different events to share a common collateral pool:

• Users can reuse deposited assets as margin across multiple markets;

• The AI module dynamically allocates liquidity based on market activity;

• Achieves low-slippage global settlement and maximum capital efficiency.

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3 Incentive Mechanisms

Liquidity Providers (LPs) can earn:

• Trading fee revenues;

• $MRN token rewards;

• Governance rights and priority access to new event creation.

All incentive parameters are adjusted quarterly by the governance DAO to maintain dynamic ecosystem equilibrium.