Maker Incentive Program
Last updated: 11 Aug 2023
To encourage market makers to provide liquidity on Drift, qualified market makers who opt into the Incentive Program will split reward pool up to 3000 USDC each week.
Anyone that can programmatically market make on Drift is invited to apply for the Program. Check out our protocolโs SDK, our open sourced market making bots and our technical documentation to get started.
Eligible market makers will be qualified on application. Reach out to (https://t.me/cindyleow) to apply.
- The Program will run each week starting on Monday, 00:00 UTC and concluding on Sunday, 23:59 UTC (โProgram Periodโ).
- Drift will notify participating market makers if the Program is paused for any particular week.
The rewards for this program are split into a Volume Reward and a Score Reward.
Volume Reward: $1,500 USDC
Score Reward: $1,500 USDC
All participating market makers make their pro-rata split of $1,500 USDC based on their relative maker volume across all markets, according to:
All participating market makers make their pro-rata split of $1,500 USDC based on their relative liquidity score within each market, according to:
This equation can be broken down into:
1. MM Score over period
This is the score for the market maker in a specific market with n snapshots over the period.
2. MM Order Score per snapshot
The MM Order Score calculates the weighted sum of the size of the market maker's ask orders at various price levels. It takes into account the quantity (Q) of lower of liquidity available at that bid, ask bracket.
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an individual MMโs liquidity within a bracket for a side (bid or ask)
all liquidity within a bracket for a side (bid or ask)
largest of an individual bracketโs bid liquidity, ask liquidity, or $5000 worth of liquidity
Bracket | Distance from best order on side |
A | within 0 - 1 bps |
B | within 1 - 5 bps |
C | within 5 - 10 bps |
D | within 10 - 20 bps |
E | within 20 - 50 bps |
F | within 50 - 100 bps |
Term | Distance from best order on side |
Qa | max(L_{A,bid}, L_{A,ask}, $5000/price) |
Qb | max(L_{B,bid}, L_{B,ask}, $5000/price) |
Qc | max(L_{C,bid}, L_{C,ask}, $5000/price) |
Qd | max(L_{D,bid}, L_{D,ask}, $5000/price) |
Qe | max(L_{E,bid}, L_{E,ask}, $5000/price) |
Qf | max(L_{F,bid}, L_{F,ask}, $5000/price) |
Note: if a single market maker provided a best bid and ask with $5000 worth of liquidity, that would be a score of 400. If another MM provided the remaining liquidity of $5000*5=$25k at all the other brackets that would be a score of 2+.75+.4+.3+.2 * 100 = 365.
Scoring incentivises orders at the top of the book. Orders within 1bp of the best bid/ask have a weighting of 4x.
mkt | ScoreRewardPool |
SOL-PERP | 500 |
BTC-PERP | 500 |
ETH-PERP | 500 |
SUI-PERP | 0 (as of August 14 2023) |
ARB-PERP | 0 (as of August 14 2023) |
This Program is an early iteration of an on-chain liquidity provisioning program the DriftDAO will eventually oversee.
Rewards will change as we move towards DriftDAO.
- Any wash trading or self matching is strictly prohibited. If wash trading or self matching is observed in order to manipulate market share, then the incentives for that month are forfeited. This is at the sole discretion of Drift Protocol.
- Qualified Market Makers will receive their payments in USDC.
- Payouts will conclude the week following the end of the Program.
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