# What is MagicSea?

MagicSea is an onchain Liquid Order Book DEX and NFT Marketplace, native on the [IOTA](https://evm.iota.org/) EVM and [Shimmer](https://shimmer.network/) EVM networks. Powered by Liquidity Book JoeV2.2 (CLMM) & UniV2 (AMM). \ Home of the [$LUM (LUM)](/tokenomics/lum-token) and [$MLUM (Magic LUM)](/tokenomics/magic-lum-token) token. {% content-ref url="/pages/lx6MV8OGJpx4oqKUDjrV" %} [Exchange](/protocol/exchange) {% endcontent-ref %} {% content-ref url="/pages/6ugvRKlKyJUAVdZoYSwW" %} [Liquidity Pools](/protocol/liquidity-pools) {% endcontent-ref %} {% content-ref url="/pages/mbcbComJdAnwvhnmesiE" %} [Earn](/protocol/earn) {% endcontent-ref %} {% content-ref url="/pages/3xv5RwarqzRSTp1Cze1l" %} [NFT Marketplace](/protocol/nft-marketplace) {% endcontent-ref %} Explore DeFi with MagicSea, the top native Decentralized Exchange (DEX) on IOTA and Shimmer EVM. Securely trade, stake & farm tokens to earn rewards on the most trusted DEX & NFT Marketplace on the Tangle. # I'm New Here

Welcome! This section is intended to help you get up to speed on decentralized finance (DeFi) and navigate MagicSea's platform. ### New to DeFi? If you have some crypto experience, but are new to DeFi, skip ahead to our [📖 DeFi Glossary](/welcome/defi-glossary). {% content-ref url="/pages/R7q9Rf5AMQUuy33axgZt" %} [DeFi Glossary](/welcome/defi-glossary) {% endcontent-ref %} ### New to MagicSea? For quick links to specific functions of the MagicSea platform, visit the [📺 How to Guides](/welcome/quickstart-guide). {% content-ref url="/pages/Trd2B0RVr9Ml0u1djdBd" %} [QuickStart Guide](/welcome/quickstart-guide) {% endcontent-ref %} ### New to the IOTA & Shimmer Community? Check out the MagicSea [🌐 Ecosystem](/welcome/ecosystem) on IOTA and Shimmer EVM {% content-ref url="/pages/aTebyg7IHn7S6htnj50Q" %} [Ecosystem](/welcome/ecosystem) {% endcontent-ref %} # QuickStart Guide

Looking for a specific function on MagicSea? These tutorials will guide you from beginner to DeFi expert, giving you the confidence to navigate our protocol with ease. Click the applicable link below to learn more: {% content-ref url="/pages/wG34vcmG36HL5NIuPP6Z" %} [How to Swap your Tokens](/protocol/exchange/swap/how-to-swap-your-tokens) {% endcontent-ref %} {% content-ref url="/pages/Jlr5QkFeuPjPDm7GY9I4" %} [How to Provide Liquidity in V2 Pools](/protocol/liquidity-pools/simple-v2-pools/how-to-provide-liquidity-in-v2-pools) {% endcontent-ref %} {% content-ref url="/pages/K1U1JGR0Z9kTI9lFqUIp" %} [How to Earn Farm V2 Rewards](/protocol/earn/farms-v2/how-to-earn-farm-v2-rewards) {% endcontent-ref %} {% content-ref url="/pages/BZV9mJdF8ZyRQabqq7Dr" %} [How to Boost your LUM to Magic LUM](/protocol/magic/booster/how-to-boost-your-lum-to-magic-lum) {% endcontent-ref %} # DeFi Glossary

If you own or have traded cryptocurrency before, but never used a decentralized exchange, staked in a pool, yield farmed, or tried any of the other services DeFi has to offer, this guide is for you. These are some of the most important concepts to understand to take advantage of the financial opportunities in DeFi. ### Key Terms * **DeFi -** Short for "decentralized finance", a catch-all term for financial services that are provided on public blockchains by leveraging smart contracts, including swapping tokens, adding liquidity, staking in pools, yield farming, and more.
* **Decentralized Exchange (DEX) -** A protocol that uses smart contracts to allow users to swap between crypto tokens without a centralized intermediary.
* **Automated Market Maker (AMM) -** An automated market maker is a type of DEX that uses a mathematical formula to price assets, rather than using an order book model of bids (buyers) and asks (sellers) typical in traditional finance on centralized exchanges.
* **Concentrated Liquidity Market Maker (CLMM) -** A concentrated liquidity market maker is a type of DEX that uses a mathematical formula to price assets, rather than using an order book model of bids (buyers) and asks (sellers) typical in traditional finance on centralized exchanges. The difference to a normal AMM is here, that liquidity providers can concentrated their liquidity within specific price ranges and increase therefore the efficiency to earn fees.
* **Swap -** To trade some amount of one token for an equivalent amount of another token.
* **Liquidity -** The extent to which an asset is available to be bought or sold. In the context of a DEX, the amount of crypto tokens that can be traded for one another.
* **Liquidity Pool -** A combination of two crypto assets in a smart contract that allows a decentralized exchange to facilitate trading between the two tokens.
* **Liquidity Provider (LP) -** Someone who adds liquidity to a protocol by supplying (generally equal) amounts of two crypto tokens to a liquidity pool.
* **LP Token -** Short for "liquidity provider token," a new token that is created and granted to a liquidity provider as a "receipt" of the liquidity that they added to a liquidity pool.
* **Staking -** The act of depositing crypto tokens that you own into a protocol or smart contract to earn rewards.
* **Yield Farming -** The act of staking LP tokens to earn tokens as a reward. Yield Farms incentivize users to add liquidity to a DEX so that the DEX can continue to facilitate token swaps between the two tokens in the liquidity pool.
* **APR (Annual Percentage Rate) -** The rate of return on staked assets per year (exclusive of the effects of compounding). These are subject to change based on a number of different factors.
* **MPR (Monthly Percentage Rate) -** The rate of return on staked assets per month (exclusive of the effects of compounding). These are subject to change based on a number of different factors.
* **APY (Annual Percentage Yield) -** The rate of return on staked assets including the effects of compounding.
* **Impermanent Loss (IL) -** A financial risk that can occur when an investor provides liquidity, which is caused by price changes in the crypto market and the way automated market makers (AMMs) are designed. # Ecosystem

The MagicSea DEX is just the starting point to build an entire ecosystem. Our ultimate goal is to support the IOTA & Shimmer ecosystem and with it all future new projects that are on the EVM chain with us. Using our development pipeline, we engage with projects that want to start with us, scale with us, and stay with us for the long term. We want to give new innovative projects full flexibility and freedom to develop and move completely borderless between IOTA and Shimmer ecosystems. With the help of LayerZero & OFT Standards, this is made possible. We are already in collaboration with more than 20 projects that embark the journey with us.

MagicSea Partners in the IOTA and Shimmer Ecosystem

# HypeTrain Campaign

MagicSea Hypetrain - Ride to IOTA EVM Campaign

## Ride the hype and earn with IOTA‘s leading native DEX while celebrating the launch of IOTA EVM! The HypeTrain to IOTA EVM is taking off! Don’t miss to hop on board! IOTA EVM is live and we are celebrating it by putting 400.000 LUM tokens up for grabs! This mania will last for \~ 3 months only. Here's everything you need to know to get on board: ### Campaign Overview The HypeTrain to IOTA EVM campaign is organised into three main pillars, each designed to reward different types of participation: 1. **Liquidity Bootstrap** (via[ MagicSea DEX](https://app.magicsea.finance/liquidityv3)): \~275,000 LUM tokens distributed via the MagicSea Leaderboard and later on through a Farming Frenzy on MagicSea. 2. **Trading Competition** (via [MagicSea Tide Campaign](https://www.tideprotocol.xyz/users/spaces/1401)): \~115,000 LUM tokens awarded to top traders on MagicSea. 3. **DEXPLORE** (via [MagicSea Zealy Campaign](https://zealy.io/cw/magicsea/questboard)): \~10,000 LUM tokens for social media participation through Zealy.\ \ *The weighting of the rewards for the three pillars can change over the course of the campaign. However, before each epoch the reward distribution will be clearly communicated.* {% hint style="info" %} **Important Links:**\ [🌐 MagicSea DEX](https://app.magicsea.finance/liquidityv3)\ 🌐 [MagicSea Tide Board](https://www.tideprotocol.xyz/users/spaces/1401)\ 🌐 [MagicSea Zealy Board](https://zealy.io/cw/magicsea/) {% endhint %} The rewards will be continuously distributed in epochs lasting two weeks each. Before each epoch the reward distribution among the three pillars will be clearly communicated. Continue, to read more in detail about the three pillars: {% content-ref url="/pages/QrIZfOlMHEe5dpG5VrIA" %} [Reward Pillars](/welcome/hypetrain-campaign/reward-pillars) {% endcontent-ref %} The HypeTrain is going to stop at three stations! Each Station celebrates new features that are being unlocked on MagicSea, bringing more people on board the HypeTrain! To read more on whats to come follow here: {% content-ref url="/pages/RCmEOYi5fnvgDACCUk7I" %} [Stations to IOTA EVM](/welcome/hypetrain-campaign/stations-to-iota-evm) {% endcontent-ref %} # Reward Pillars

Estimated Reward Distribution of HypeTrain to IOTA EVM

The HypeTrain Campaign is built on three reward pillars through which the community can participate grow MagicSea on IOTA EVM and earn! ### 1. Liquidity Bootstrap (via[ MagicSea DEX](https://app.magicsea.finance/liquidityv3)) The Liquidity Bootstrap phase is dedicated to building a strong foundation of liquidity on MagicSea. Here's how you can participate: * **Provide Liquidity in V2 Pools and Farm with us:** MagicSea is starting with a Farm Frenzy! Provide Liquidity to earn those juicy rewards! The earlier you join the higher the rewards are.\ 🌐 [MagicSea DEX | Simple V2 Farms](https://app.magicsea.finance/farms/:148)
* **Provide concentrated Liquidity Book positions and join the competition:** The LeaderBoard on MagicSea ranks the best performing concentrated LB positions in terms of fee revenue! The more fees you earn with your position the higher you can climb on the LeaderBoard. The leaderboard always showcases the top 200 positions over the past 2 weeks. If your liquidity position is in the top 200, you will earn LUM rewards on top of the earned trading fees!\ 🌐 [MagicSea DEX | LB Leaderboard](https://app.magicsea.finance/leaderboard) #### **Rewards:** \~275,000 LUM tokens distributed based on your liquidity contributions and performance of your concentrated liquidity. Rewards are distributed in 2 week epochs. *** ### 2. Trading Competition (via [MagicSea Tide Campaign](https://www.tideprotocol.xyz/users/spaces/1401)) Showcase your trading skills and climb the ranks in our trading competition. Here's what you need to do: * **Trade on MagicSea:** Execute trades on MagicSea and accumulate points based on your trading volume. * Only trading pools that feature either IOTA or a stable-coins such as USDC give you points * The more trading volume you generate the higher is the amount of LUM rewards you earn. 🌐 [MagicSea Tide Board](https://www.tideprotocol.xyz/users/spaces/1401)\ 🌐 [MagicSea DEX | Trade](https://app.magicsea.finance/swap) #### **Rewards:** \~115,000 LUM tokens distributed to the top traders based on their performance during the competition. Rewards are distributed in 2 week epochs. *** ### 3. DEXPLORE (via [MagicSea Zealy Campaign](https://zealy.io/cw/magicsea/questboard)) Get involved with MagicSea on social media and earn rewards for your participation. Here's how to join: * Engage on Social Media: Participate in challenges, share content, and engage with the MagicSea community on platforms like Twitter, Youtube, and more. * Earn Points: Complete social media tasks and earn points for your activity. 🌐 [MagicSea Zealy Board](https://zealy.io/cw/magicsea/) #### **Rewards:** \~10,000 LUM tokens distributed to participants based on their engagement and points earned. Rewards are distributed in 2 week epochs. {% hint style="warning" %} *The weighting of the rewards for the three pillars can change over the course of the campaign. However, before each epoch the reward distribution will be clearly communicated.* {% endhint %} # Stations to IOTA EVM Throughout the campaign, new features will be unlocked on MagicSea in three thematic phases that resemble stations on our way to IOTA EVM. Each station opens new opportunities to Traders, Liquidity Providers, Projects and Magic LUM holders! At each station everyone on board the HypeTrain can dive into the new features and the HypeTrain will onboard new people!

### 1. Station: Liquidity Kickstart Kick off the campaign by contributing to our liquidity pools. This station focuses on building and incentivising liquidity on MagicSea, setting the stage for a robust trading environment! ### 2. Station: NFT Mania Immerse yourself in the world of NFTs with MagicSea. Trade collections, and earn rewards through our NFT marketplace as we celebrate the creativity and innovation within the IOTA ecosystem. Collect your favourite NFTs in the ecosystem. ### 3. Station: Magic Happening Unlock the full potential of MagicSea with Magic LUM the governance token of MagicSea which is capped at 1 million token only. Stake your MLUM tokens to earn 100% of the DEX revenue in USDC, earn bribing rewards by voting on emissions and participate in shaping the future of MagicSea. Be part of shaping the future of MagicSea. Join us on this exciting journey as we launch the IOTA EVM and unlock new features on MagicSea. Be part of the HypeTrain to IOTA EVM and earn with IOTAs native DEX! # Support

## Having an issue? If you are experiencing bugs or issues when using the MagicSea protocol, try these easy steps first: ### **Internet Browser / Device** * Clear your internet browser cache and refresh the app/webpage. * Restart your internet browser and/or device. * Update your internet browser and/or device. * Try again in incognito mode. If these steps don't resolve the problem, try these additional product-specific steps below. ### **Connection / Wallet** * Retry your transaction with higher gas fees. * Disconnect and reconnect your wallet. * Update your wallet. * Uninstall and reinstall your wallet. **(Make sure you know your seed phrase first!)** *** ## **Need Further Assistance?** General user support for MagicSea is available through our fantastic admins and community moderators on the official MagicSea [Discord Server](https://discord.gg/XjdN8EjYfM) and [Telegram Channel](https://t.me/tangleseaglobal)! For the best and fastest response, we recommend to open a [#🆘-ticket](https://discord.com/channels/852909119379865641/1072224994119127102) or using the [#🚨-support](https://discord.com/channels/852909119379865641/957237221721772092) channel on our Discord Server. *If you choose to reach out via one of our social media channels, be aware that our team members, admins and moderators will NEVER contact you asking for personal information or for funds! Our team members, admins and moderators will NEVER DM you first!* {% hint style="danger" %} **Never under any circumstances, give someone your private key/seed phrase/recovery key!** {% endhint %} # Wallets

## Supported Wallets * **Metamask Wallet:** [https://metamask.io](https://metamask.io/) * **Bloom Wallet:** [https://bloomwallet.io](https://bloomwallet.io/) * **Rabby Wallet:** [https://rabby.io](https://rabby.io/) * **WalletConnect:** [https://walletconnect.com](https://walletconnect.com/) ## Choose a Wallet To get started on MagicSea, the first thing you'll need is to set up a supported wallet that supports IOTA EVM and Shimmer EVM network/chain. Crypto Wallets are available on both, desktop computers and on smartphone devices. You'll need to choose a wallet that fits your needs best. {% hint style="warning" %} **When you're setting up a wallet, be sure to:** \ \ ✅ Download and install only the latest version from an official source. \ ✅ Follow the setup guide carefully. \ ✅ Safely back up your recovery phrases. \ ❌ NEVER share your recovery phrases with anyone, under any circumstances. \ ❌ NEVER input your recovery phrase to a website or app, other than your wallet app {% endhint %} ## Connect your Wallet **Step 1:** Open MagicSea app **Step 2:** Click on Connect Wallet **Step 3:** Choose your preferred Wallet **Step 4:** Approve to connect to MagicSea app **Step 5:** Add IOTA EVM and/or Shimmer EVM network/chain to your account **Step 6:** Your wallet is now connected to IOTA EVM and/or Shimmer EVM and the MagicSea app # How to Connect your Wallet *COMING SOON!* # Multichain

MagicSea is a multi-chain DEX which makes it easy for users to navigate between chains and identify opportunities easily. \ MagicSea is currently supporting two chains: * IOTA EVM * Shimmer EVM MagicSea will automatically connect your wallet with the correct chain depending on the service you choose. You can also specifically choose a chain in the top right of the page:

If MagicSea does not connect you with the correct network you can always add the network manually with the following setup: ### IOTA EVM {% hint style="info" %} **Network name:**\ Iota EVM **Network URL:**\ **Chain ID:**\ 8822 **Currency symbol:**\ IOTA **Block explorer URL (Optional):**\ [https://explorer.evm.iota.org](https://explorer.evm.iota.org/) {% endhint %} ### Shimmer EVM {% hint style="info" %} **Network name:**\ Shimmer EVM **Network name:**\ **Chain ID:**\ 148 **Currency symbol:**\ SMR **Block explorer URL (Optional):**\ {% endhint %} \ To find out more about how to navigate between different chains on MagicSea check out the following tutorial: {% content-ref url="/pages/ywKgdTa2mLwjLqpIbBcT" %} [How to Navigate between Chains](/protocol/multichain/how-to-navigate-between-chains) {% endcontent-ref %} With MagicSea you can also easily transfer your tokens between different chains choosing among established bridge providers such as LayerZero, Stargate and Axilar. {% content-ref url="/pages/cNjaAn5A9bHjSrXhjMWV" %} [Bridge](/protocol/exchange/bridge) {% endcontent-ref %} {% content-ref url="/pages/5crAh13T6enFwzUGjeev" %} [How to Bridge between Chains](/protocol/exchange/bridge/how-to-bridge-between-chains) {% endcontent-ref %} # How to Navigate between Chains *COMING SOON!* # Exchange

MagicSea DEX is an Automated Market Maker (UniV2 AMM & Liquidity Book CLMM) that allows users to exchange tokens on the blockchain. \ \ The liquidity provided to the exchange comes from Liquidity Providers ("LPs") who stake their tokens in Liquidity Pools. \ \ When a user makes a token swap (trade) on the exchange, a trading fee will be charged. ### To swap one token for another follow the simple instructions below: 1. Navigate in the menu to "Trade" 2. Select from and to which token you want to swap 3. Enter token amount you want to swap 4. Click "Swap" button 5. Check price impact and total fees 6. Click "Confirm Swap" button 7. Confirm transaction in wallet 8. Done # Swap

## How Swaps Work Swapping tokens is one of the most fundamental functions of a DeFi DEX. Decentralized exchanges like the MagicSea DEX allow users to send their tokens into the protocol and receive as close to an equal value of another token as possible, after accounting for transaction fees, slippage, and price impact. In the world of DeFi, smart contracts dictate each step of a swap transaction, with no human or centralized intermediaries involved. This gives users several advantages relative to traditional or centralized currency exchanges, including: * Fast transaction speeds * Permissionless trading * Flexibility and access to a wide variety of tokens * Markets that are always open Most importantly, swapping between tokens allows users to take advantage of unique opportunities within DeFi. For example: * A user who wants to buy the native chain token, like IOTA token, can use the MagicSea DEX to swap it with an existing token, such as the ETH token ($ETH) or a stablecoin ($USDC). The user now has a utility token which they can hold, stake to earn rewards. * A user who is interested in supporting a particular crypto project on Shimmer or IOTA can use MagicSea to buy a listed project's token with IOTA, USDC, or any other of the tokens listed on the DEX. At any hour, they are free to swap tokens at fast speeds without the permission of an intermediary. * A user who wants to consolidate crypto tokens into stablecoins to add stability to their portfolio can use the MagicSea DEX to trade their project tokens for USDC or USDT or any other listed stable coins at any time, for any reason, without requesting permission from a centralized source. ### **Trading Fees** MagicSea collects a fee every time users swap tokens on the exchange. A portion of the fees goes to the Magic LUM Staking Pool, and the rest is distributed to liquidity providers. ### **Slippage** While token swaps do occur at very fast speeds on the blockchain, there can still be a (usually small) difference between the price you see when you submit a swap transaction, and the price that applies when the transaction is recorded on the blockchain. This difference in prices is called "slippage". When you submit a swap on the MagicSea, you select a "slippage tolerance" amount, which is the pricing difference that you are willing to accept while the trade is executing. While slippage tolerance ranges between 0.10% and 1.00%, the default slippage tolerance is **0.50%**. However, If the price difference between submission and confirmation of the trade exceeds that amount, the trade will fail. If the token you are trading has a **reflect fee**, then the slippage tolerance will need to meet or exceed the reflect fee percentage for the trade to succeed. ### **Price Impact** Slippage occurs not only from the change in prices from other user's trades, but also from the trade you submit. This is called "price impact", and it's expressed in percentage at the bottom of the swap module. If your slippage tolerance is below the price impact of your trade, the trade will fail. An price impact (or slippage) occurs only on MagicSea if the trade is moving the price from one bin to another. If the trade goes through a liquidity book pool and stays in the same active bin, then the swap is slippage free. ### **Tx Deadline** Swaps have a default transaction deadline of 20 minutes before they time out and fail. This ensures that incomplete transactions do not remain in your wallet indefinitely. You can adjust this time limit in the settings of the exchange window. ### **Expert Mode** MagicSea's Expert Mode turns off the Confirm transaction prompt and allows high slippage trades that can result in bad rates and lost funds. Expert Mode can also allow you to send the tokens you're trading into to an address other than your own. We recommend you enable this mode only if you are an experienced user who understands these risks well. {% hint style="info" %} **Expert Mode Warning:** MagicSea makes no warranty on Expert Mode transactions, and is not responsible for exchanges made at lower-than-market rates, lost funds, or tokens sent to wallets out of your control. Expert Mode transactions are made at your own risk. {% endhint %} # How to Swap your Tokens {% embed url="" %} HOW TO TRADE ON A DEX (DECENTRAL EXCHANGE) | MAGICSEA DEX Tutorial {% endembed %} # Bridge

MagicSea supports allows you to bridge tokens across IOTA EVM, Shimmer EVM any many more EVM ready chains and networks. Powered by LayerZero and Stargate V2 you can easily bridge tokens and NFTs without leaving MagicSea DEX. Find out more about those supported bridges on the projects website: Stargate V2: [https://stargate.finance](https://stargate.finance/)\ LayerZero: [https://layerzero.network](https://layerzero.network/)\ ShimmerBridge: [https://shimmerbridge.org](https://shimmerbridge.org/bridge) # How to Bridge between Chains *COMING SOON!* # Liquidity Pools

Liquidity pools are essential mechanisms in decentralized finance (DeFi), allowing users to trade tokens instantly without the need for traditional market makers. By pooling their assets into a smart contract, liquidity providers (LPs) enable decentralized trading at any time, with liquidity determined by the total value locked in the pool. In return, LPs earn trading fees based on their share of the pool, making it a potentially rewarding endeavor. **Our Liquidity Pool Types** MagicSea offers two innovative types of liquidity pools, catering to different user preferences and strategies: 1. **Simple V2 Pools** * Modeled after the popular Uniswap V2 protocol, our Uni V2 pools utilize a constant product formula to manage liquidity. This model is renowned for its simplicity and effectiveness, providing ample liquidity with minimal slippage. It’s ideal for standard trading pairs and offers a straightforward way for LPs to earn passive income. 2. **Concentrated Liquidity Book (LB) Pools** * Leveraging the advanced Liquidity Book model from Trader Joe V2, these pools allow for more flexible and efficient liquidity provisioning. By enabling liquidity concentration within specified price ranges, LPs can optimize their capital efficiency and potentially earn higher returns. This model is particularly beneficial in volatile markets or for pairs with less predictable price movements. **Join Our Liquidity Providers** By becoming a liquidity provider on MagicSea, you not only contribute to the robustness of the trading environment but also partake in the growth of the ecosystem. Whether you choose the reliability of Uni V2 pools or the advanced features of Liquidity Book Joe V2 pools, your involvement is pivotal to our mutual success. # Simple V2 Pools

Liquidity is always added in a 1:1 value ratio into a Liquidity Pool. When you add liquidity to a pool, you will receive LP tokens which represent a share of the pool. When someone makes a token swap, a transaction fee will be charged. 50% of the fee will be returned to liquidity providers in the form of a fee reward. {% hint style="info" %} **For instance, if you add liquidity in the form of $SMR and $LUM, you will receive LUM-SMR LP tokens. The number of LP tokens you receive represents your share in the SMR-LUM liquidity pool. You can always request the withdrawal of your funds by removing your liquidity.** {% endhint %} Please note that when adding liquidity you will need to have a sufficient amount of each token and you can only allocate them in a 1:1 value ratio.\ Let’s say you want to add the following liquidity: 10 SMR / 14 USDC. If you have less than 14 USDC or less than 10 SMR, you will not be able to proceed. You need to have a sufficient amount of each token. {% hint style="danger" %} Keep in mind that providing liquidity could be subject to **impermanent loss** and it **may carry certain risks**. Make sure you are aware of all the pros and cons of providing liquidity before taking any actions. You can learn more about impermanent loss by clicking[ here](https://academy.binance.com/en/articles/impermanent-loss-explained). {% endhint %} #### To add Liquidity for a token pair follow the simple instructions below: 1. Navigate in the menu to "Pool" -> "My Liquidity" 2. Click "Add Liquidity" 3. Select your two input token you want to supply 4. Select token amount you want to supply and lick "Supply" 5. Check transaction overview and click "Confirm Supply" 6. Confirm transaction in wallet 7. You find your Liquidity Token under "My Liquidity" # How to Provide Liquidity in V2 Pools {% embed url="" %} HOW TO EARN & PROVIDE LIQUIDITY ON A DEX | MAGICSEA Tutorial {% endembed %} # Concentrated LB Pools

The Liquidity Book feature allows to concentrate liquidity into single bins, which leads to more efficient and flexible liquidity provisioning and seamless trading experiences with zero slippage and low fees. With the Liquidity Book (LB), liquidity providers can provide liquidity within a specified price range of their choice - this is called **concentrated liquidity**. Using the USDC/USDT pair as an example, if an LP chooses to provide liquidity between $0.99 and $1.01 then the LP will earn trading fees so long price is within that range. ### Bins[](https://docs.traderjoexyz.com/concepts/concentrated-liquidity#bins) To allow concentrated liquidity, the price curve is discretized into **bins**, which is similar to the tick concept in Uniswap V3. The main difference however, is that LB uses the **constant sum** price formula instead of the constant product formula. What this means is that each bin represents a single price point and the difference between two consecutive bins is the bin step. Take for example USDC/USDT again. If the current price is $1 and the bin step is 1 basis point (i.e. 0.0001 or 0.01%), then the next consecutive bins up are 1∗1.0001=$1.0001, 1.0001∗1.0001=$1.00020001 etc. Note that this is the geometric sequence. In addition to using a different pricing invariant, bin steps are **not** restricted to 1 basis point and is a parameter set by the pool creator. Because of this, there can be **multiple** markets of the same pair but varying only in their bin step. The Liquidity Book concept provides high flexibility about how users can provide their liquidity. If you are interested in learning more about it, check out the next chapter "Liquidity Strategies". {% hint style="danger" %} Keep in mind that providing liquidity could be subject to **impermanent loss** and it **may carry certain risks**. Make sure you are aware of all the pros and cons of providing liquidity into a concentrated liquidity pool before taking any actions. You can learn more about impermanent loss by clicking[ here](https://academy.binance.com/en/articles/impermanent-loss-explained). {% endhint %} # Liquidity Book Strategies Liquidity Book AMM opens up a new opportunities for your Liquidity Management. With Liquidity Book, you can deploy active liquidity provisioning, this means that you can deploy and manage varying range of strategies, to suit your investment goals. Below is an outline of the various types of strategies that are available, split between Beginner and Advanced. ## Beginner Strategies ### **Normal (Bell Curve)**

Distributes liquidity along the "bell curve", making it similar to the liquidity in order book exchanges. Allows to capture fees from both price increases and decreases, while concentrating liquidity around certain price point. **✅ Advantages:** * Perfect in calm markets * Capital efficient **❌ Drawbacks:** * Increased risk of impermanent loss ℹ️ **Considerations:** * Requires rebalancing around current price for maximum effectiveness ### Spot (Uniform)

Evenly spreads the liquidity out across a specified range or deposits it entirely inside one bin. Having all liquidity in one bin allows users to benefit from the "leverage" the discrete liquidity provides. **✅ Advantages:** * Perfect for Stablecoin pairs * Very capital efficient **❌ Drawbacks:** * Biggest risk of impermanent loss if price leaves the bin **ℹ️ Considerations:** * Can be used in volatile pairs for capturing greatest fees with the highest risk of impermanent loss ### Max (Uniform)

The spot option, taken to its absolute. The liquidity is allocated to all currently available bins, resembling the liquidity composition in traditional x\*y=k exchanges. **✅ Advantages:** * Perfect for passive liquidity providing * Reduced risk of impermanent loss compared to other strategies **❌ Drawbacks:** * Reduced capital efficiency **ℹ️ Considerations:** * While the capital efficiency is lower than with other shapes, it is still better than x\*y=k exchanges ### Bid-Ask

Mimics the bid-ask spread on an order book exchange, allowing liquidity providers to capture fees, as market fluctuates. **✅ Advantages:** * Captures market volatility * Allows to Dollar Cost Average in/out of positions **❌ Drawbacks:** * Riskier than other strategies ℹ️ **Considerations:** * Similar to normal shape, requires rebalancing to stay effective ## Advanced Strategies These strategies outlined below are for experienced Traders and all are considered risky. Before deploying any of the below strategies you should be fully aware of the divergence risk they may possess. If you are uncomfortable with closely monitoring your position, please do not engage in active and higher risk liquidity strategies, such as the below. ### Ranged Limit Orders

Users can use single-sided one-bin spot liquidity to place "limit orders" outside of the current price. Once the price reaches these bins, liquidity in them will be converted from one token to another. **✅ Advantages:** * Buy/sell tokens at prices you want * Withdraw/change your order at any time **❌ Drawbacks:** * Doesn't earn fees while inactive ℹ️ **Considerations** * Require withdrawing to prevent converting back ### De-peg Bets

Spot shape is perfect for providing liquidity for stablecoin pairs, it can also be used to capture fees during minor de-pegs. Combining two spot shapes above and below the current price can even allow users to earn from de-pegs in both directions. **✅ Advantages:** * Earn fees from volatility * Help contribute to market stability **❌ Drawbacks:** * Risky if de-peg is permanent ℹ️ **Considerations:** * Similar to limit orders, this approach earns no fees while inactive ### Dollar Cost Average (DCA) While Earning

Dollar Cost Average While Earning Strategy

Combining a one-sided bid-ask shape with uniform distribution can allow you to buy your favourite tokens for cheap if an opportunity arises while continuing to earn fees from swaps around the current price. **✅ Advantages:** * Stable fee revenue * Dollar Cost Average at selected prices **❌ Drawbacks:** * Sacrifices some fee performance for the Dollar Cost Average opportunities ℹ️ **Considerations:** * If the order fills it needs to be withdrawn ### Gradual Ladder Orders

Layering multiple spot uniform shapes on top of each other in one direction allows users to gradually scale in and out of positions with market movements. **✅ Advantages:** * Earn fees if the market moves in your favour * Passively buy/sell tokens at regular intervals **❌ Drawbacks:** * Big risk of impermanent loss if the market moves against your position **ℹ️ Considerations:** * Require withdrawing to prevent converting back ### Sell / Buy Walls

Combining normal and uniform shapes can allow liquidity providers to form liquidity "walls". This way the liquidity is much deeper one side of the price while keeping exposure in case price moves in the opposite direction. **✅ Advantages:** * Contribute to price floors while earning fees * Less risky than ladder orders approach **❌ Drawbacks:** * Can result in impermanent loss if the price moves beyond the wall ℹ️ **Considerations:** * Price movements can result in wall needing rebalancing # Liquidity Book Learning **Why Liquidity Book?** **What is Concentrated Liquidity?** Understanding how concentrated liquidity works can provide higher returns, higher efficiencies, and DEEP liquidity. The concept of concentrated liquidity was popularized by[@Uniswap](https://twitter.com/Uniswap)V3 in 2021. In traditional models, LPs are limited to supplying liquidity to the entire bonding curve, from a price range of 0-∞. This means that a majority of the supplied liquidity may never actually be used. Concentrated Liquidity with Traditional Models Concentrated liquidity allows liquidity providers to allocate capital to closed intervals of an asset's price range. Instead of supplying liquidity from 0-∞ you can instead concentrate your liquidity around the price where it is actually needed. Concentrated Liquidity with Liquidity Book Supplying liquidity to a selected price becomes possible by breaking the price range into discrete ranges. **The Liquidity Book using 'bins', with each bin representing a unique price.** Users are able to distribute liquidity however they like into each liquidity bin. There are endless ways to structure your liquidity depending on your goals. Check out [Liquidity Strategies](/protocol/liquidity-pools/concentrated-lb-pools/liquidity-book-strategies). Deploying liquidity to a concentrated range is significantly more capital-efficient. Traditional V2 AMMs are very capital-heavy, requiring large amounts of TVL to facilitate swaps. Increased capital efficiencies allow concentrated AMMs to facilitate higher volumes with far less TVL required. Increased capital efficiencies can also allow token pairs to: • Provide deep token liquidity, with far less capital • Provide liquidity with low-to-no need for incentives • Have increased flexibility • Gain higher real-yield rewards for LPs **For users swapping assets, concentrated liquidity can result in far less or even zero slippage.** Slippage is the difference between the quoted price and the executed price, and it can have a significant impact on your trades. For each swap executed on Swapline, a small swap fee is accumulated and distributed to liquidity providers. **This generates real yield for liquidity providers, paid in the same tokens you provided.** Swap rewards are only earnt by liquidity providers deposited at the currently active price. As the asset price moves out of your liquidity range, you will no longer earn any fees. Liquidity providers may consider changing their price range to continue earning fees. A tightly concentrated price range can introduce higher risk. As token prices diverge from their prices at deposit, your liquidity changes in value when compared to its value if tokens were held outside the pool. Divergence loss can be amplified in concentrated liquidity pools. **Liquidity Book introduces variable fees that aim to compensate liquidity providers for impermanent loss (divergence loss)**. During times of high volatility, variable fees are increased which can help mitigate the impacts of impermanent loss. In the simple AMM V2 Pools users will be accustomed to providing liquidity to a 50:50 value ratio. In a concentrated liquidity AMM only one discretized range will contain both Token X & Y. This means when the price leaves your liquidity range you will be left holding only 1 token type Liquidity Providers Token Holdings with Liquidity Book Concentrated liquidity is a little bit more challenging for liquidity providers and protocols. # Dynamic Fee System Dynamic Fee System for Liquidity Book Pools The dynamic fee system adjusts fees during volatile situations to reduce and compensate for possible impairment loss. #### Base Fee[](https://docs.traderjoexyz.com/concepts/fees#base-fee) You can see the base fee of each pool on the all pools page. The exact percentage is set by the protocol owner when creating the pool.

#### Variable Fee[](https://docs.traderjoexyz.com/concepts/fees#variable-fee) The variable fee on the other hand depends on the volatility of the market. It will be affected by the frequency of the swaps, but doing large swaps accross many bins (on large price movements) will also increase it. Fees are calculated and distributed *per bin*, to allow a fair distribution of the fee to the liquidity providers of the bin crossed. Fees are calculated iteratively as each bin is crossed (if the swap is large enough). In other words, if a large swap crosses n bins, then the total swap fee is calculated per bin k, where k is the difference in bin IDs from the initial bin where the swap originated and the current bin in which it is being calculated. # How to Provide Liquidity in LB Pools *COMING SOON!* # Earn

Earn provides users with various opportunities to generate income in the form of earned fees and rewards from their digital assets. This section encompasses farming, staking, and a specialized dashboard for managing Liquidity positions. ### Key Features to Earn on MagicSea: 1. **Farming:** Users can participate in yield farming by providing liquidity to selected pools and earning rewards in the form of tokens. 2. **Staking:** MagicSea offers straightforward staking opportunities where users can allocate their tokens to receive rewards. Staking is a great way for users to earn passive without any impermanent loss risk. 3. **Liquidity Book Management Dashboard:** For those involved in our Concentrated Liquidity Book pools or Simple V2 Pools, the dashboard provides detailed management tools. Users can adjust their positions, track earnings, and optimize their strategies in real-time to enhance returns. # Farms V2

Yield Farms allow users to earn LUM or/and Partner Token while supporting MagicSea by staking LP Tokens. Check out our How to Use Farms guide to get started with farming. MagicSea offers multiple farming opportunities to our users. You can stake your LP tokens and earn LUM and partner tokens in return. MagicSea will incentivize many liquidity pairs by offering Liquidity Providers the chance to stake their LP tokens in the farms. {% hint style="info" %} With the special farm zap feature, you can zap directly into a farm without the hassle of doing all the liquidity-providing steps up front. You can select a token and the smart contracts will do everything for you automatically. {% endhint %} #### To deposit tokens into a Farm MagicSea's Zap-In function offers two easy paths: Deposit LP token into Farm: 1. Navigate in the menu to "Earn" -> "Farm" 2. Select Farm you want to enter and enable Farm if needed 3. Click "Deposit" to open the Zap-In window 4. Select the first option showing your available LP Tokens for this Farm 5. Enter LP Token amount you want to add 6. Click "Confirm" 7. Confirm transaction in wallet 8. Your LP Token are now deposited into the Farm and will not appear in your wallet anymore Deposit LP token into Farm starting from a single token: {% hint style="danger" %} Warning: When depositing from a single token into a Farm three things happen: 1\. You are swapping half of your token for the second farm-token\ 2\. You are providing Liquidity into the token pool by exchanging your token for LP Token\ 3\. You are entering the LP token into the selected Farm {% endhint %} * Navigate in the menu to "Earn" -> "Farm" * Select Farm you want to enter and enable Farm if needed * Click "Deposit" to open the Zap-In window * Select the single token you want to supply into the farm * Enter Token amount you want to allocate * Check slippage of trade * Enable Token if needed * Click "Confirm" * Confirm transaction in wallet * Your newly created LP Tokens are now deposited into the Farm and will not appear in your wallet anymore # How to Earn Farm V2 Rewards {% embed url="" %} HOW TO FARM ON A DEX | MAGICSEA Tutorial {% endembed %} # Market Maker LB Rewards

Market Maker LB Farms are a very efficient and target way to incentive liquidity where its most needed. MagicSea is using reward hooks within a JoeV2.2 Liquidity Book Pool to incentivice specific bins with LUM or partner tokens. You can see the specific rewarded bins in the pool detailed page:

As soon as you provide liquididy in these incentivised bins, you get the rewards automatically. You can claim the rewards at any time in the reward section on the detailed page or on the farm page or on your dashboard. # How to Earn Market Maker LB Rewards *COMING SOON!* # Staking Pools

In addition to the Farms, there are also "Staking" Pools. With a staking pool MagicSea creates an incentive to hold a certain token longer and earn rewards. For example, the LUM Pool can be used to stake the earned LUM Tokens and earn even more LUM Tokens as Reward. So there is an incentive to hold this certain token and not to sell it. The difference between a farm and a staking pool is that instead of LP tokens, which represent a trading pair, individual tokens can be staked in this pool. LUM tokens are also distributed as rewards. For a farm, two tokens must always be linked, resulting in an LP token, which can then be farmed. Thus, the impermanent loss is always given as a risk in farming (see paragraph Farms). Since only single tokens are directly staked in a Staking Pool, there is no impermanent loss risk. Different Staking Pools can be offered at MagicSea: * **Stake Native reward token -> Earn Native reward token** * **Stake Native reward token -> Earn Partner Token** * **Stake Partner Token -> Earn Partner Token** Some staking pools will only be accessable with holding an specific NFT in your wallet. #### To Stake a single token follow the simple instructions below: 1. Navigate in the menu to "Earn" -> "Stake" 2. Select Staking-Pool you want to enter and enable Staking-Pool if needed 3. Click "Stake" 4. Enter the amount of tokens you want to stake 5. Click "Confirm" 6. Confirm transaction in wallet 7. Your Tokens are now deposited into the Staking-Pool and will not appear in your wallet anymore # How to Stake your Tokens *COMING SOON!* # Magic

{% content-ref url="/pages/2TS6VtvOWVieADaDzNow" %} [Booster](/protocol/magic/booster) {% endcontent-ref %} {% content-ref url="/pages/Fbo1pxvsTKkJonH8hlkw" %} [Magic LUM Staking](/protocol/magic/magic-lum-staking) {% endcontent-ref %} {% content-ref url="/pages/PztpTKyTUD5qiDr7Yo3T" %} [Magic LUM Voting](/protocol/magic/magic-lum-voting) {% endcontent-ref %} # Booster

The Booster is a specially developed smart contract that upgrades LUM to Magic LUM. All Magic LUM tokens are distributed by this smart contract. The Booster combines several functions in its structure: On the one hand, it ensures that new Magic LUM Tokens are primarily distributed to MagicSea users who also provide liquidity. On the other hand, the Booster uses a unique burning mechanism to remove LUM from the market. {% content-ref url="/pages/2bPqhlNJ7WEMI3MU5DrK" %} [LUM Token](/tokenomics/lum-token) {% endcontent-ref %} {% content-ref url="/pages/WeRJYh84pTw89lLEG66S" %} [Magic LUM Token](/tokenomics/magic-lum-token) {% endcontent-ref %} {% embed url="" %} To upgrade LUM to Magic LUM, LUM must be placed in the booster and in return Magic LUM will be distributed. However, since this is a so-called refining process, the inserted LUM tokens in the Booster are burned in percentage over time, while Magic LUM tokens are distributed in the same turn. This means that the process is time dependent. The longer the LUM Tokens are in the Booster, the more LUM are converted to Magic LUM. For security reasons, the deposited LUM tokens are locked in the booster for 72h. So in each case a certain percentage of his deposited LUM tokens will be converted into Magic LUM. However, this conversion process from LUM to Magic LUM is not a 1 LUM to 1 Magic LUM conversion. Rather, the Booster works similar to a staking pool. A defined amount of Magic LUM is distributed per second to all participants of the Booster. The payout rate of Magic LUM is independent of how many LUM tokens were placed in the Booster. With an increased amount of deposited LUM, the yield decreases. However, unlike a staking pool, LUM is continuously removed from the pool through the refinement process. So over time, the amount of LUM in the Booster steadily decreases and thus the yield steadily increases if no new LUM is contributed to the Booster.

The Booster Dynamic is an innovative feature that creates a balance between LUM and Magic LUM. For users who want to participate in MagicSea for a long time and share in its success, the Booster offers a unique opportunity to get Magic LUM. {% hint style="info" %} **What does the Efficiency Score on the Booster mean?** The frontend calcuates two numbers: * How much LUM in $ have been burned in the last 10 minutes * How much MLUM in $ have been distributed in the last 10 minutes We then take these two numbers and do the following calculation: **Efficiency = (MLUM Reward in $ / LUM Burn in $) - 1** This will show how much more or less you get in $ at this point and time compared to simply swap LUM to Magic LUM. -> Green Number = Positive % Number = Makes sense to join the booster -> Red Number = Negative % Number = Does not make sense to join the booster {% endhint %} # How to Boost your LUM to Magic LUM {% embed url="" %} # Magic LUM Staking

You can stake and lock your Magic LUM token in the Magic LUM staking pools to benefit from protocol profits. All protocol returns like a part of the trading fees, Fairlaunch listing fees, and NFT trading fees flow into the staking pool in form of USDC. \ \ Rewards are distributed every few days, and you can Claim at any time. ## Lock your Magic LUM to boost your rewards and vote for LUM emissions in farms and staking pools The minimum lock is 7 days. You can further lock your Magic LUM into a NFT lock position to receive more rewards. You can lock up to 365 days. The lock boost multipliers are: ***7 Days = 1x Multiplier***\ ***90 Days = 1,5x Multiplier***\ ***180 Days = 2x Multiplier***\ ***270 Days = 2,5x Multiplier***\ ***365 Days = 3x Multiplier*** To be allowed for voting you need to lock your Magic LUM for at least 90 days. ### Stake Positions You can have several lock positions with different lock setups. There are three options to edit existing positions: **Add additional Magic LUM:**\ If you have a remaining lock time, the average new lock time is calculated:\ \ *`New Lock Time = (Remaining Lock Time * Staked MLUM Amount + MLUM Amount to add * Initial Lock Duration) / (MLUM Staked Amount + MLUM Amount to add)`*\ \ **Re-New Lock:**\ You can renew your lock position to the initial lock amount. This function is important to be able to renew your existing position if the remaining lock time is not enough for voting anymore.\ \ **Extend Lock:**\ You can extend your lock position to a new lock time. This function is important for stakers who choose a initial lock position under 90 days and want to participate in voting. With extend lock they can change the existing stake position to a new lock time which is applicable for voting. # How to Earn Protocol Profits *COMING SOON!* # Magic LUM Voting

## Voting and Bribing for LUM Emissions Magic LUM holders can vote every two weeks for v2 and LB pools to decide on which 30% of LUM emissions should be distributed. Each Magic LUM lock position needs to be voted seperately. The voting will decide which pools receive LUM emissions and how much. The sum of all Magic LUM votes within on epoch will define the LUM emission percentage for all farms. A pool needs a minimum of 500 Magic LUM votes to be applicable for a LUM farm. ## Who is allowed to vote Eligibility requires a 90-day MLUM lock: Only MLUM staked with at least a 90-day lock period is eligible for voting and your pending lock time needs to be longer than the Epoch duration. ## How Voting Works * **Vote with MLUM:** To participate in voting, you must lock your MLUM tokens for at least 90 days. Locked MLUM provides voting power to decide how 30% of liquidity emissions (LUM) are distributed among different liquidity pools.1 MLUM = 1 Vote, no matter the lock.
Each MLUM NFT position needs to be voted separately for each epoch. You can only cast your votes per MLUM NFT position once per epoch. If you don't use 100% of your voting power, the remaining voting power will be lost for this epoch for this NFT position. * **Voting Epochs:**\ Each voting period, or Epoch, lasts two weeks. During this time, MLUM holders can vote for their preferred liquidity pools. * **Time sensitive Voting for Bribes:**\ Your earned bribes within an Epoch depends on when you cast your vote. The earlier you vote in an Epoch, the more you earn from a bribe (linear decline). * **LUM Farm Activation:**\ After an Epoch ends, votes determine which liquidity pools receive a LUM Farm. A minimum of 500 Votes is required to get a LUM Farm. The LUM farms go live shortly after the epoch ends. {% hint style="info" %} #### Voting Strategies * The pools which have earned the most fees in the weeks bring the most benefits for the Magic LUM stakers. Therefore, taking no bribes into account, these pools are the most profitable to vote for. * To earn maximum bribe rewards from any pool in the epoch, you must re-cast your vote each epoch. * The earlier you vote in an epoch, the more of the possible bribe rewards you will get. Voting late in an epoch will subject you to a greater vote decay. {% endhint %} ## How to Earn Bribes: * **Check Bribe Listings:** Protocols will post bribes tied to specific liquidity pools in the voting dashboard. * **Vote Strategically:** Cast your vote for the pools earning you the highest fee share for your liquidity or that offer the most appealing bribes. * **Vote Early:** As earlier you vote for a pool which has a bribe, as more you will get from the bribe amount. There is linear decline in the bribe payout to incentivise early voting. * **Collect Rewards:** Once the Epoch ends, you’ll receive the bribes associated with the pools you supported and the farms go live if they cross the 500 MLUM benchmark. ## How to Bribe: * **Everyone can add bribes:** Bribing is fully permissionless, if you want to bribe any pool, you can do so. * **Only Whitelisted token:** Only whitelisted token can be used for bribing. If you want to see your token in this list, please contact the MagicSea team. * **Bribe before Epoch starts:** Only bribes which are submitted before the epoch are included. Within the epoch, no further bribes can be added. If bribes are submitted while an epoch is running, they will be included for the next epoch. ## Why Participate in Voting and Bribing? * **Shape Liquidity Allocation:** Your vote directly influences where LUM rewards are distributed, helping your preferred pools thrive. * **Earn Bribes:** Maximize your returns by aligning your votes with the most lucrative bribes. * **Strengthen the Ecosystem:** By participating, you contribute to a robust and efficient liquidity distribution process on MagicSea. # How to Vote for Protocol Emission *COMING SOON!* # NFT Marketplace

The MagicSea NFT Marketplace is a cornerstone of the protocol offering: ➡️ **Buy, Sell & Manage NFTs** ➡️ **List NFT Collection of your Project** ➡️ **Use NFT restricted Staking Pools** Projects can list their collections for trading and earn royalties for every NFT trade of their collection. Further, projects can benefit from the functionality to open NFT restricted staking pools! This is a way for projects to distribute rewards to the community in a fully decentral yet targeted way. Only owners of the NFT will be able to join the staking pool. MagicSea and its community is benefiting from the NFT Marketplace even further. The NFT Marketplace takes between 2.5% and 5% trading fees. # Lumis

Lumis may look small and cute, but don’t make the mistake of underestimating them! Together, they form a uniquely strong community of successful risk-takers! Beyond their vivid and aesthetic visuals, Lumis have therefore been steadily claiming a space of their own in the world of Decentralized Finance (DeFi). This chapter delves into the unique utilities that Lumis bring to their fortunate holders. **What are Lumis?** Lumis are not just any ordinary Non-Fungible Tokens (NFTs). Lumis were, until the launch of ShimmerEVM, never bought or sold! They are symbols of friendship, created by community mamber and distributed to community members who have been with MagicSea for years now. Every Lumi embodies a promise, made and delivered upon by a friend. A beacon of trust in a trustless crypto world. Born from the deep liquidity of MagicSea and native to the very first DEX deployed to IOTA EVM, they are the inhabitants of one of the most prosperous regions in the vast expanse of IOTA EVM: a buzzing centrepiece of the new promised land.

## **Utility of Lumis** **1) Access to the Fairlaunches and More:** Lumis are the inhabitants of MagicSea! As such, all Lumi holders are granted a whitelist spot for some of the upcoming Fair-Launches. With a Whitelist spot, Lumi holders can join earlier and secure a spot in a Fair-Launch. Afterwards, the floodgates are opened, and it’s first come, first serve! Many large ecosystem projects are planning fair launches on MagicSea. If you hold a Lumi, you hold a privileged position! **2) Digital Collectibles:** At their core, Lumis serve as digital collectibles. Their intricate designs, varied rarities, and the stories they tell make them sought-after assets in the digital art world. All Lumis hold the same utility, but not all Lumis are created equally! Each Lumi is unique. You will never find two identical Lumis. With super rare Lumis like the Lumi Pirate, Lumi Bot, or the golden, bronze, and silver Lumi, the collection also embodies special moments during the MagicSea development. If you want to see how rare your Lumi is, take a look here: Lumis are friends that keep on giving — friends you should think twice before parting with.[
](https://magicseadex.medium.com/?source=post_page-----2d0f0c44105a--------------------------------)

# How to Buy, Sell & Manage your NFTs *COMING SOON!* # Fairlaunch

The Fairlaunch-pad is a perfect opportunity for projects to bootstrap their liquidity in an efficient and safe way. Users can contribute with IOTA in exchange for Project/IOTA LP Tokens, which are to be claimed once the liquidity event ends. The received LP will have the exact same value in $IOTA as the contribution. The project tokens will be used to form the LP Tokens, consequently the final token price will simply be determined by the following calculation: 50% of Total IOTA allocated / Amount project token. With this process, the LP pool for the project token can be safely opened and all Fairlaunch participants pay the same token price without the risk of getting bot attacked in the initial liquidity bootstrapping process.

Overall the Fairlaunch can be done in different phases with specific NFT or max cap restrictions. The launch project is deciding in which phases and with which settings the Fairlaunch needs to be conducted. # How to Participate in a Fairlaunch *COMING SOON!* # Token Economics

The token economy is a central component of a DEX and a key factor in its long-term success or failure. MaigcSea has developed an innovative dual token system. {% content-ref url="/pages/2bPqhlNJ7WEMI3MU5DrK" %} [LUM Token](/tokenomics/lum-token) {% endcontent-ref %} {% content-ref url="/pages/WeRJYh84pTw89lLEG66S" %} [Magic LUM Token](/tokenomics/magic-lum-token) {% endcontent-ref %} MagicSea's two tokens, LUM and Magic LUM, each have different, important features that provide value to both the DEX and its holders. LUM can be upgraded to Magic LUM through the specially developed smart contract, which we call "Booster". This unique upgrading process creates a link between LUM and Magic LUM, giving the DEX more stability and resilience. The following graphic is a simplified illustration of the concept:

Both the properties (utilities) of LUM and Magic LUM, as well as the unique functionality of the booster, are critical to the token economy of MagicSea.

{% hint style="info" %} **Key Facts** Token economics are one of the most important components of a DEX. MagicSea has developed an innovative dynamic of setting up the DEX for long-term success and not losing sight of the most important KPIs (Key Performance Indicator) of a DEX: * Constant LUM minting rate (no soft cap) as an incentive for liquidity providers enables the offering of competitive APRs. * Innovative refining process from LUM to Magic LUM that continuously takes LUM off the market and burns it. * Constant positive price pressure on LUM through the use of platform fees for buyback & burn strategies for LUM. * Limited Magic LUM governance token with access to protocol earnings staking pools. {% endhint %} # LUM Token

LUM ($LUM) token is the reward token of MagicSea. It is used to provide a high incentive to customers to provide liquidity to the DEX. ### **Launch** The LUM Token was launched for the first time via a Fairlaunch liquidity event. This means that no tokens have been previously minted and distributed to investors/community via ICOs, private sales, or pre-airdrops. This is very crucial because the more tokens that have been distributed in advance, the higher the selling pressure can be on the token after the launch. ### **Minting** A constant of 4 LUM can be maximal minted and distributed with each second. The LUM token has no hard or soft cap. The minting rate will be reduced at the beginning of the DEX to reduce inflation impact. In addition, some LUM are minted into the DEV wallet to cover the costs of the protocol infrastructure. ### **Utility** The LUM token is the reward token of the MagicSea DEX. Through participation, such as providing liquidity, the LUM token can be earned and traded on the market. The demand for LUM is additionally spurred by the fact that particularly high rewards can be expected for staking and farming with LUM. Moreover, LUM is crucial for anyone who wants to obtain Magic LUM via the Booster. Accumulating LUM and refining it in the Booster is therefore the best strategy to get Magic LUM and thus participate in the long-term success of MagicSea.

# Magic LUM Token

Magic LUM ($MLUM) is the governance token of the MagicSea DEX. It offers owners the opportunity to participate in the success of MagicSea. ### **Launch** Unlike the LUM token, Magic LUM is distributed exclusively via the Booster contract. In the Booster, your LUM will get refined to Magic LUM. During this refining process, the LUM tokens in the Booster are burned in percentage over time, while Magic LUM tokens are distributed in the same turn. Hereby LUM is upgraded to Magic LUM. ### **Minting** Magic Lum Token is the limited governance token of MagicSea. {% hint style="info" %} Magic LUM has a maximum supply of 1 million tokens and can only be earned through the refinement booster. {% endhint %} Tokens are distributed over a minimum 5-year time frame. The minting rate for the Magic Lum Booster will be adjusted each epoch to ensure the maximum amount of 1 million tokens. In each epoch the minting rate is defined in the Booster Smart Contract when it is created. \ \ 205.000 Magic LUM Token have been minted at the beginning for initial liquidity and team allocation. All of these tokens will be locked in the liquidity pool or MLUM staking pool smart contracts. | Timeframe | Epoch Duration | Minting MLUM per Month | Cumulativ # Magic LUM Minted | | ------------------ | -------------- | ---------------------- | ---------------------------- | | First Month | 1 Month | 30.000 | 235.000 | | Epoch 1 ShimmerEVM | 4 Months | 13.200 | 287.800 | | Epoch 1 IotaEVM | 3 Months | 1.000 | 290.800 | ### **Utility** Magic LUM is the governance token of the MagicSea DEX. Magic LUM combines several features that make it more resilient and powerful than LUM: {% hint style="info" %} The Magic LUM token provides access to all protocol earnings via a special staking pool. {% endhint %} * Magic LUM is limited to a total quantity of 1 million tokens. * With Magic LUM, one participates in DEX's business model and receives special rewards via special staking pools. * Magic LUM gives voting opportunities in the MagicSea DAO.

Magic LUM fulfills important characteristics of a robust token. Magic LUM is limited in total amount, generates cash flow through rewards, is diversified through the treasury and gives the holder voting opportunities over the DEX. Magic LUM is therefore suitable for everyone who wants to shape MagicSea in the long term and participate in its success!
{% embed url="" %} # Official Links

### MagicSea Accounts & Links Homepage: [https://magicsea.finance](https://magicsea.finance/home) \ Discord: \ X: [ ](https://twitter.com/ShimmerSeaDefi) \ \ DeBank: \ Telegram: \ Tide: [
](https://debank.com/official/MagicSea)\ Zealy: [https://zealy.io/cw/magicsea](https://zealy.io/cw/magicsea/)\ Youtube: \ Medium: \ Linktree: *** ### IOTA Network Accounts & Links Homepage: [https://www.iota.org](https://www.iota.org/)\ Discord: [https://discord.iota.org](https://discord.iota.org/)\ X: IOTA EVM Explorer: [https://explorer.evm.iota.org](https://explorer.evm.iota.org/)\ IOTA EVM Toolkit: [https://evm-toolkit.evm.iotaledger.net](https://evm-toolkit.evm.iotaledger.net/) *** ### Shimmer Network Accounts & Links Homepage: [https://shimmer.network](https://shimmer.network/)\ Discord: [https://discord.shimmer.network](https://discord.shimmer.network/)\ X: \ \ Shimmer EVM Explorer: [https://explorer.evm.shimmer.network](https://explorer.evm.shimmer.network/)\ Shimmer EVM Toolkit: [https://evm-toolkit.evm.shimmer.network](https://evm-toolkit.evm.shimmer.network/) *** ### Wallets MetaMask Wallet: [https://metamask.io](https://metamask.io/)\ Bloom Wallet: [https://bloomwallet.io](https://bloomwallet.io/)\ Rabby Wallet: \ WalletConnect: [https://walletconnect.com](https://walletconnect.com/) *** ### Bridges Stargate V2: [https://stargate.finance](https://stargate.finance/)\ LayerZero: [https://layerzero.network](https://layerzero.network/)\ ShimmerBridge: [https://shimmerbridge.org](https://shimmerbridge.org/bridge) # Business Proposals

**B2B Offerings in the DeFi, GameFi and NFT sector:** \- Project Token (Icon & Info) Listing\ \- Project Token Fairlaunch\ \- Project Token Farms & Staking\ \- Project NFT Collection Listing **General Marketing Offerings:** \- Social Media Marketing Collaboration\ \- AMA-Sessions, Interviews, Presentations *** ## Want to work with us? Feel free to reach out to us via one of the followings ways for the best and quickest response: **💼** [**Google Docs Application Form**](https://t.co/D1dxTx4dkr) 🎟️ [**Business Proposal Ticket**](https://discord.com/channels/852909119379865641/1072224994119127102) # Smart Contracts

## MagicSea Smart Contracts on Iota EVM

Contract	Address
Factory	0x349aaAc3a500014981CBA11b64C76c66a6c1e8D0
Master Chef	0xaEd6DC9B5AE8aC8149403D2659de1239655E6D4a
Router	0x531777F8c35fDe8DA9baB6cC7093A7D14a99D73E
LUM Token Address	0x34a85ddc4E30818e44e6f4A8ee39d8CBA9A60fB3
Magic LUM Token Address	0xA87666b0Cb3631c49f96CBf1e6A52EBac79A6143

*** ## MagicSea Smart Contracts on Shimmer EVM

Contract	Address
Factory	0x4fb5d3a06f5de2e88ce490e2e11d22b840d5ac47
Master Chef	0x686eAd3Fee35C811684E6158408B49220d912dD4
Router	0x1dBCC54d42503dA1455A38ab74b0e6b780d65Bc0
LUM Token Address	0x4794Aeafa5Efe2fC1F6f5eb745798aaF39A81D3e
Magic LUM Token Address	0xf21Bc150F4D08Dce61bd16cDbfcB3D212b575b26

# Audits

Security is one of the most important aspects in the technology area of MagicSea. Since this is a decentralised fully automated smart contract protocol, the same applies here: **Code is law!** For this reason, the MagicSea DEX code is put through its paces before launch. The testing includes an initial scan by the Coin Risk platform and two full audits by dedicated external teams.

Secure and audited code by HashEx, AuditOne and Sherlock

* **AUDIT 1:** MagicSea (formerly ShimmerSea) DEX V1 is fully audited by [HashEx](https://hashex.org/). {% file src="/files/wI301xcfFa3dwfbSalFz" %} * **AUDIT 2:** MagicSea (formerly ShimmerSea) DEX V1 is audited by [AuditOne](https://www.auditone.io/). {% file src="/files/tx6J9BOS6qIJKBjdQQ0k" %} * **AUDIT 3:** MagicSea (formerly ShimmerSea) Booster Smart Contract is audited by [AuditOne](https://www.auditone.io/). {% file src="/files/oDrQUK32dQyAS1SLEzCz" %} * **AUDIT 4:** MagicSea MasterChef, Rewarder, Magic LUM Staking & Magic LUM Voting/Bribing is audited by [Sherlock](https://www.sherlock.xyz/) via [public contest with 300+ auditors](https://github.com/sherlock-protocol/sherlock-reports/blob/main/audits/2024.07.11%20-%20Final%20-%20MagicSea%20-%20the%20native%20DEX%20on%20the%20IotaEVM%20Audit%20Report.pdf). {% file src="/files/s2eAkGtksGsQEypNsytS" %} # Disclosure

As you can see in the tokenomics section, the LUM token was fairlaunched and fully distributed to the community. The Magic LUM token is distributed via the booster and is capped at 1 Million tokens. The MagicSea team received 20% (200k MLUM Token) from the total Magic LUM supply. These 20% include team allocation as well as operations. These token are locked in different lock positions:\ \ ***25% locked for 12 month in the MLUM Staking pool (50.000 MLUM)***\ ***75% locked for 24 month with linear vesting (150.000 MLUM)*** This will ensure that the team is locked but gets rewarded (salary) for the protocol contributions. As the team self funded the development of MagicSea, this will be the first time after more than 2 years of development for the team members to earn with the protocol. At the beginning the team will have a larger share of the Magic LUM staking pool and with time gets more and more diluted. This allows for a natural step by step decentralization of the protocol. For the team this creates a strong incentive to ensure growth of the protocol. The team is fundamentally incentivized to grow liquidity, trading volume and fee revenue. In general, this setting combines the interests of the team with the longterm users of the DEX and creates a strong motivation for the team to make the protocol as successful as possible. The team only earns when the protocol is profitable. This set-up was chosen on purpose to not unload the development risk to the community and to keep the team focused on the KPIs that matter to be successful. The team token will NOT be used for voting.