💸Horizon Liquidity
Overview
Horizon Liquidity provides concentrated liquidity infrastructure for the protocol. It allocates capital to curated markets that support collateral pricing, trade execution, and lending operations.
Liquidity providers deploy capital into range based vaults that maintain active depth within defined price ranges. Trading activity generates dynamic fees that accrue directly to liquidity providers.
Nova emissions coordinate liquidity formation. Emissions are allocated across approved markets according to curator defined weightings per market. These weightings determine incentive flow and direct liquidity toward collateral pairs that support borrowing activity and liquidation execution.
Architectural Foundation
Horizon Liquidity is built on Algebra Integral V4 CLAMM, a modular, EVM-compatible concentrated liquidity automated market maker.
Algebra V4 provides:
Range-based concentrated liquidity positions
NFT-based LP positions with configurable price bands
Market-specific fee configuration
Plugin-enabled extensibility
Separation of AMM core logic from auxiliary logic layers
This architecture enables Horizon to treat liquidity as programmable infrastructure rather than static pooled capital.
The modular design allows incentive logic, fee routing, and accounting extensions to integrate directly with liquidity markets while preserving core AMM invariants.
Concentrated Liquidity Model
Horizon Liquidity utilizes a concentrated liquidity model in which liquidity providers define price ranges within which their capital is active.
Compared to traditional constant-product AMMs, this structure:
Increases fee density per unit of capital
Reduces idle liquidity outside active trading ranges
Enables deeper effective liquidity at lower total capital
Improves spread efficiency
The result is higher capital efficiency without requiring increased token emissions.
Liquidity as Risk Infrastructure
Within Horizon, liquidity serves as systemic risk infrastructure.
Deep and responsive liquidity:
Reduces slippage during liquidations
Improves execution reliability in stressed conditions
Supports oracle stability through tighter spreads
Limits bad debt propagation
Enables more precise collateral parameterization
Liquidity depth directly influences lending market safety and capital efficiency.
Horizon Liquidity therefore functions as both an incentive layer and a risk mitigation layer.
Liquidity Farm Fees & Buyback and Burn
Nova supply contraction is linked to protocol activity. Platform trading fees are distributed as follows:
72% → Liquidity providers 28% → Nova buyback and burn
The buyback allocation is used to purchase Nova on the open market. Acquired tokens are permanently burnt.
Buyback volume increases with trading activity, linking Nova supply reduction directly to liquidity usage and market volume.
Incentive Integration
Horizon Liquidity receives Nova emissions as defined in the Nova Emission Model.
Nova emissions distributed to liquidity markets:
Are fixed and time-based
Do not scale with TVL or trading volume
Are allocated using effective share weighting
Cannot be accelerated or altered
User participation affects distribution share, not total emissions.
This structure ensures predictable issuance while allowing competitive capital allocation across approved markets.
Market Configuration
Algebra’s architecture allows market-specific configuration.
Each liquidity pair may define:
Fee parameters appropriate to asset volatility
Incentive eligibility status
Approved emission weighting
This allows Horizon to support:
Blue-chip markets
Stablecoin pairs
Long-tail assets
Multi-Chain Deployment
Algebra Integral separates AMM core logic from plugin layers.
This modularity allows Horizon Liquidity to deploy across multiple EVM-compatible networks while preserving consistent economic logic.
Horizon Liquidity may operate on:
Ethereum
Base
Sonic
BNB Chain
Polygon
Arbitrum
Optimism
Each deployment maintains protocol-defined fee routing and incentive logic.
System Role Summary
Horizon Liquidity is the protocol’s liquidity coordination engine.
It provides the infrastructure for capital efficient markets, incentive distribution, and fee routing across the Horizon ecosystem.
It:
Enables capital-efficient markets
Strengthens lending stability
Routes trading fees into Nova supply reduction
Integrates with the Nova reward framework
Scales across multiple chains under consistent economic rules
Liquidity within Horizon is treated as programmable capital infrastructure, supporting both market efficiency and long-term supply discipline.
Horizon Liquidity receives a portion of Nova incentives as defined in the Nova Emission Model (see Nova Overview section).
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