Vertex Edge: Cross-Chain Liquidity (v2)

    Vertex Edge - The Concept

    Edge functions like a virtual market maker between exchange venues on different chains.

    The state of the sequencer is split (e.g., sharded) between supported chains concurrently, intaking and cloning inbound orders from each chain. Independent orders from one chain are then matched against liquidity from multiple chains.

    Both sides of the trade are filled out, and the sequencer (Edge) takes the opposite side of the inbound trades — automatically hedging and rebalancing liquidity on the back-end between chains.

    Notably, the sequencer only mirrors resting liquidity (e.g., maker orders) across the sharded states of the Vertex instances on different base layers. Taker orders remain unchanged, and are submitted directly from an independent Vertex instance, such as the DEX Blitz, to the sequencer’s unified liquidity layer — Edge.

    Order matching between chains occurs concurrently, with the state of the sequencer’s consolidated liquidity profile across all of the supported base layers sharded and propagated to each Vertex instance.

    As a result, Edge is capable of matching inbound orders from one chain with the combined orderbook liquidity of all of the base layers plugged into the Vertex sequencer.



    Source: Vertex-Edge Medium Post

    Example

    • Assume there are two Vertex instances (Arbitrum and Blast).
    • Alice submits a market order (taker) on Blitz, to long the ETH-PERP at price X.
    • The sequencer (Edge) matches the order against the best liquidity after examining the -orders aggregated across the two Vertex instances on Arbitrum and Blast.
    • The best offer is from John who is trading on Arbitrum.
    • John is now short on Arbitrum and Alice is long on Blast.
    • In the middle, the sequencer (Edge) takes equal opposing positions on each chain. Edge is now short on Blast and long on Arbitrum.
    • Edge injects Alice’s matched order into the sequencer queue of batched orders to render and settle on-chain to Blast — simultaneously sending John’s order to be settled on Arbitrum.
    • Over time, Edge will continually build long and short positions on local chains.
    • Periodically, liquidity between chains will be aggregated and settlement will be made on the backend.



    Source: Vertex-Edge Medium Post

    • The dashboard tracks metrics/stats related to Vertex's EDGE product.

    • Data tracking starts March 13th 2024 onward - the date the 2nd instance went live (blitz)

    • All instances are now covered! 🚀