Concentrated Liquidity Pools

In traditional AMMs like Uniswap V2, liquidity is spread infinitely from 0 to ∞, diluting capital across every possible price point. Bronto's concentrated liquidity lets providers focus their assets within specific ranges—for example, $0.8-$1.2—creating deeper liquidity zones exactly where they're needed.

The Mathematical Edge: Quantifying Efficiency

Using the formula:

Efficiency = 1/(1 - (a/b)^(1/4))

where a and b are your price bounds, concentrated liquidity is approximately 6.5x more efficient than standard AMMs where liquidity is equally distributed across all prices.

To illustrate this dramatic difference:

• A traditional AMM pool with $6.18M in TVL provides the same liquidity depth as just $950K in a concentrated liquidity pool ($6.18M/6.5 = $950K)
• Conversely, if we deploy that full $6.18M in a concentrated range (e.g., $0.8-$0.1.2), it would provide liquidity equivalent to $40.17M in a traditional AMM

What This Means for Users

1. Extreme Capital Efficiency: Deploy capital exactly where it's needed, maximizing return on investment
2. Low Slippage, Better Pricing: Deeper liquidity at relevant price points reduces execution costs
3. Higher LP Fees: Earn more rewards by optimizing position ranges

Place Range Orders

Concentrated liquidity allows placing range orders—similar to limit orders in traditional finance but with additional benefits:

• Take-Profit Orders: Provide a single asset in a pool above current price to sell when price increases
• Buy Limit Orders: Provide a single asset in a pool below current price to buy when price decreases

Unlike traditional limit orders, range orders earn fees while they are in active price ranges.

Strategic Considerations

• Tighter ranges approximate limit orders more closely but may earn fewer fees
• Wider ranges capture more fees but increase the risk of partial fills if price reverses

Available Fee Tiers