DEX - Clovis Exchange (Coming Soon)

Clovis Exchange is a cross-chain DEX that aggregates liquidity to deliver universal pricing for traders and creates multi-yield opportunities for LPs by pairing AMM positions with lending deposit receipts from Clovis Market.

The exchange consists of two core components:

Hub Chain DEX Aggregator

• Operates on the hub chain (Sei Network) and aggregates prices from all hub chain liquidity sources, including Clovis’s own AMMs.

• In a cross-chain swap, for example, WBTC on Base → WETH on Arbitrum, the user deposits WBTC into the Clovis Base Vault. The Base messaging adapter sends instructions to the hub, where contracts execute the trade by swapping WBTC already held in the Sei Vault into WETH via the DEX aggregator. This avoids bridging the user’s WBTC from Base.

• Once the swap is executed within the user’s slippage tolerance, the hub instructs the Arbitrum Vault to release WETH to the user’s wallet on Arbitrum.

• Because all execution flows through the hub, Clovis requires the fastest finality and lowest costs to ensure a smooth and efficient user experience. Sei Network delivers both, and being EVM-compatible, also allows Clovis to integrate with the broader EVM ecosystem.

• If part of the trade is matched internally through Clovis’s own AMM (for example, the Clovis CLMM), that portion does not require actual WBTC to be present in the Sei Vault. Instead, it is processed as an internal LP composition change, while maintaining the correctness of the global state.

• Example: Cross-Chain Swap (WBTC on Base → WETH on Arbitrum)

  1. User Deposit

     • The user initiates a swap by depositing WBTC into the Clovis Base Vault.

  2. Instruction to Hub

     • The Base messaging adapter sends trade instructions to the hub chain (Sei Network).

  3. Trade Execution at Hub

     • On the hub, Clovis contracts execute the swap by exchanging WBTC already held in the Sei Vault for WETH via a DEX aggregator.

     • This is done without bridging the user’s WBTC from Base, avoiding additional latency and cost.

  4. Slippage Check

     • The trade is executed only if the result is within the user’s specified slippage tolerance.

  5. Settlement Instruction

     • After the trade is completed on the hub, a settlement message is sent from the hub to the Arbitrum Vault.

  6. Token Release

     • The Arbitrum Vault releases the purchased WETH to the user’s wallet on Arbitrum.

  7. Performance Considerations

     • All actions go through the hub for execution, so Clovis requires the fastest finality and lowest cost possible for a smooth and efficient user experience.

     • Sei Network provides this performance and, as an EVM chain, enables integration with the larger EVM ecosystem.

  8. Internal AMM Matching (Optional)

     • If part of the trade is matched internally through Clovis’s own AMM (e.g., Clovis CLMM), that portion does not require actual WBTC in the Sei Vault.

     • Instead, it is recorded as an internal LP composition change while maintaining the correctness of the global state.

Clovis AMMs

• Clovis will operate its own AMM pools that accept user deposits.

• These pools can support a variety of AMM logics including CPMM, CLMM, CSMM, stableswap, PMM, and dynamic AMM, selected to best suit specific asset pairs.

• Clovis AMMs pair assets with Clovis Market deposit receipts as LP assets, enabling LPs to earn lending yields in addition to trading fees and bridging rewards.

How to Provide Liquidity?

1. User deposit to Arbitrum (Spoke chain A)

   • A user deposits assets (e.g., WETH and USDC) into Clovis Exchange on the Settlement Layer.

   • Clovis sends a cross-chain message from Arbitrum (state update) to the Clearing Layer.

   • Clovis Exchange does accounting and mints equivalent cloTokens (e.g., cloWETH and cloUSDC) on the Clearing Layer.

2. LP created on Sei (Clearing Layer)

   • The cloTokens are paired in the Clearing Layer’s liquidity pool, representing the user’s share of the total liquidity.