Protocol Reserve Value ratio
The protocol set a new parameter protocol reserve value ratio, RR, as:
It indicates the number of reserves occupied by a single TiUSD circulating in the market. In other words, it represents the average issuance price of TiUSD in the Protocol. Then the above formula is transformed into:
In the most extreme case, maximum slippage caused by the Protocol to users is 50%. Hence, for the Protocol, the core to maximize the RR focus by using PAV and reduce users trading slippage. In TiTi Protocol, the PAV is mainly allocated to the market maker fund as revenue and risk reserve following the proportion determined by the community governance.