# Problem & Solution ## Limitations of Traditional Trading #### **Lack of Transparency** * In many centralized exchanges, transaction records and liquidation processes are often opaque, making it difficult for traders to verify the fairness of the system. #### **High Barriers to Entry** * Orderbook-based futures trading typically requires a deeper understanding of advanced trading strategies and often favors institutional traders or large funds with significant capital. #### **Difficulty in Risk Diversification** * When liquidity is spread thinly across multiple assets or orderbooks, market stability can suffer, leading to higher price slippage and volatility. ## How waveX Addresses These Challenges #### **Transparent On-Chain Trading** * Every step of opening or closing a position is executed via smart contracts, creating a fully **verifiable record** on the blockchain. This transparency reduces the risk of hidden fees or unfair liquidations. #### **WLP (Liquidity Pool) Structure** * Instead of matching orders through an orderbook, waveX relies on a shared liquidity pool where deposited assets facilitate both long and short positions. * **Lower Entry Barrier**: You only need a small amount of assets to become a liquidity provider. * **Consolidated Liquidity**: By pooling assets in one place, waveX can offer more stable trading conditions and reduced price slippage. #### **Regular Rewards Distribution** * Liquidity providers (LPs) earn some of various fees (e.g., open and close positions, swaps) as rewards, distributed weekly (typically on Wednesdays, subject to change). * Here is the details for the reward: --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://docs.wavex.fi/docs/problem-and-solution.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.