In the first part of our blog series, we explored Central Limit Order Books (CLOBs) and how they help match buyers and sellers through a shared public order book.
In the second part , we took a closer look at the other side of the trade, the market makers.
We explored:
What market makers do (and why they matter)?
How Automated Market Makers (AMMs) work?
And why AMMs, are simpler for providing liquidity?
If you haven’t read the previous posts, we recommend starting there, it’ll make this next part much easier to follow.
Liquidity for markets
Order books don’t work without liquidity, someone has to be on the other side of every trade.
Market makers fill this role, earning profits from the spread. On popular tokens with high trading volume, market makers are happy to jump in as it’s profitable.
But if you're a new project launching a token, it’s a different story. Hiring a professional market maker is expensive. And if your token doesn’t have enough volume, they’re not interested.
AMMs solved this to a large extent, anyone can add liquidity. But what if we could bring that flexibility to order books?
Introducing Vaults
This is why we built Vaults on Kuru.
Vaults take the simple idea behind AMMs, like the Uniswap v2 curve, and plug it into an order book.
Here’s how it works:
The vault splits the AMM curve into many tiny orders on the book.
It behaves like a default market maker for the market.
Anyone can deposit tokens into a vault and instantly provide liquidity.
For the first time, you can earn fees from an order book, just like you would with an AMM
The best part? Every market on Kuru comes with a vault!
That means you can launch a token and have instant liquidity on the order book from day one. No market maker needed. The vault will handle it.
At the same time, the market stays open to everyone. Traders can place limit orders, and professional market makers can still step in when needed. If your token gains enough traction, they will naturally join in and provide liquidity.
If you’re curious about how Vaults work under the hood, check out our technical docs.
Vaults are now live on Kuru. We would love to hear your feedback on this new feature.
Now, anyone can launch a token, provide liquidity, and start participating in order book markets from day one.