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Market Maker Program

Edited

To be eligible for this program, please reach out to us at vip@backpack.exchange

Total Amount: 5% of equity as of December 1, 2023. 

Starting from June 2024 and for a limited amount of time, each Market Maker has the option to have Backpack buy back the awarded equity at the end of each month at the previous fundraise valuation ($120m as of February 2024). At this valuation, the spot market maker rewards are equivalent to ~$200k/month.

Timeframe: 

  1. 2.5% for spot for January 1 to December 31, 2024:

    1. 1% for Primary Spot Pairs, 0.083% per month.

    2. 1% for Secondary Spot Pairs, 0.083% per month.

    3. 0.5% for discretionary rewards for new pairs or pairs that need additional liquidity, 0.0417% per month. 

  2. 2.50% for derivatives, 0.5% for the first month of launch (1H 2024), remainder 0.295% per month for derivatives over the next 11 months.

Allocation:

  • For Primary Spot Pairs: 0.083% * (monthly maker volume divided by total monthly maker volume by all eligible MMs) per month. 

    • Primary Spot Pairs include: SOL/USDC, ETH/USDC, BTC/USDC, USDC/USDT. Additional pairs may be added from time to time as Primary Spot Pairs with advanced notice. 

    • KPIs for SOL/USDC, ETH/USDC, BTC/USDC: $50k per side within 7.5bps from mid each side and $100k within 15 bps from mid each side.

    • KPIs for USDC/USDT: $75k within 3bps from mid each side, $100k within 7.5bps from mid each side, and $250k within 15 bps from mid each side.

    • (Jan 1st to Feb 29th) MMs with a KPI uptime of >95% will be eligible for a larger share of the equity allocations than MMs with KPI uptime of 80%-95%. Allocations to MMs with 80%-95% KPI uptime will be reduced by 30%, which will go into the pool to be paid out to MMs with >95% KPI uptime proportional to their maker volume market share.

    • (1st March onwards) MMs with a KPI uptime of > 80% will be eligible for a larger share of the equity allocations than MMs with KPI uptime of < 80%. MMs with > 80% KPI uptime will receive a 30% boost to their volume on the relevant pairs, which will be taken from the pool of MMs with < 80% KPI uptime proportional to their maker volume market share.

    • (1st July onwards) an equal portion of the equity designated for Primary Pairs for the month will be allocated to each Primary Pair.

  • For Secondary Spot Pairs: 0.083% * (monthly maker volume divided by total monthly maker volume by all eligible MMs) per month. 

    • KPIs for Secondary Spot Pairs: $30k per side within 12.5bps from mid each side and and $50k within 15 bps from mid each side.

    • (Jan 1st to Feb 29th) MMs with a KPI uptime of >95% will be eligible for a larger share of the equity allocations than MMs with KPI uptime of 80%-95%. Allocations to MMs with 80%-95% KPI uptime will be reduced by 30%, which will go into the pool to be paid out to MMs with >95% KPI uptime proportional to their maker volume market share.

    • (1st March onwards) MMs with a KPI uptime of > 80% will be eligible for a larger share of the equity allocations than MMs with KPI uptime of < 80%. MMs with > 80% KPI uptime will receive a 30% boost to their volume on the relevant pairs, which will be taken from the pool of MMs with < 80% KPI uptime proportional to their maker volume market share.

    • (1st July onwards) an equal portion of the equity allocated for the Secondary Pairs for the month will be allocated to each Secondary Pair.

  • For Discretionary Spot Pairs: Will be announced for each month. In the event that no discretionary spot pairs are announced for a given month, the rewards will be allocated equally to the Primary and Secondary Spot Pairs. 

    • January: none

    • February - April: SOL/USDC, BTC/USDC, ETH/USDC.

    • May: primary pairs

    • June: ETH and Bitcoin

  • MMs must comply with Backpack Exchange's User Agreement and all applicable policies and procedures.

  • Backpack Exchange reserves the right to waive certain KPI requirements for a certain period of time in its sole discretion. 

Other Information:

  1. The spot program begins on January 1, 2024 and will be evaluated on a monthly basis.

  2. Minimum qualification KPIs for derivatives: to be determined closer to derivatives launch

  3. All MMs onboarded will enjoy VIP Tier 4 (0 maker fees) for the first 60 days; thereafter, VIP tier will be based on their volumes. Backpack Exchange does not, and will not entertain special fee deals with any MM. Fee schedules with all MMs are the same.

  4. Within 3 months, equity will be paid out to participants who get at least 1% of the allocation for the month, subject to AML/KYC requirements.

  5. MMs participating in this program are not able to participate in other programs.

Backpack Exchange reserves the right to modify this program with a 60-day advance notice for reasons including preventing bad or disruptive behavior.

Do you have questions or require further information?

Please reach out to us at: support@backpack.exchange

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