Economic Mechanism
How Tumbuh Smart Rebalance Generate Yield
Tumbuh’s smart rebalance are built to automate and optimize liquidity provisioning across DeFi through a two model:
Passive Market Making Vaults deploy capital into AMMs like Morpho, Aerodrome, providing liquidity to concentrated liquidity pools. Strategies include intelligent tick placement to maximise fee capture while minimising impermanent loss (IL). These passive strategies benefit from:
Real-time rebalancing
Dynamic range management
Predictive analytics to adapt to volatility
Protocol-Managed Market Making In protocol-managed strategies, vaults act on behalf of token issuers or exchanges. Smart vault execute liquidity provisioning to maintain price stability, reduce volatility. This includes:
Stablecoin anchors (e.g., BTC/USDT, USDC/DAI)
Vaults with IL protection for volatile pairs
Custom cooldown logic for strategic exits
Yield Composition Vault APY is driven by: Fee earnings from CLMM LP positions Spread capture from active trading Utilization premiums based on vault demand All gains flow back to the vault, increasing the Net Asset Value (NAV). Performance is benchmarked regularly. Data Tracking To ensure accurate accounting, Tumbuh tracks and records the following information: All fee collection events from the DEX. Swap transactions occurring within the Vault’s liquidity ranges. Conversion of collected fees into IDRX using timestamp-based price feeds. Snapshots & Storage Data is recorded at fixed intervals (every 10 minutes) and stored at the user level in the database. For each snapshot, the following are tracked: User’s Fees Token A Amount User’s Fees Token B Amount User’s Rewards Token C Amount User’s Rewards Token D Amount User’s New Rewards (from the last snapshot, in USD) User’s Cumulative Rewards (in USD) This structured approach ensures transparent and verifiable calculation of user earnings, while providing real-time insights into both token-denominated and IDRX-equivalent rewards.
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