HMM Liquidity

HMM is driven by protocol-owned liquidity initially funded by Haedal itself.

Unlike traditional AMM DEX platforms, HMM operates with extremely high capital efficiency, meaning it does not require a large amount of TVL to maintain decent liquidity depth. The main purpose behind HMM’s design is to empower the Haedal ecosystem and further optimize haSUI’s APR. Therefore, at least in the early stages, the running of HMM does not need external LPs to provide large amounts of capital; instead, it will be initialized completely with Haedal’s own liquidity. The initial funds will be seeded by the Haedal team, with profits reinvested continuously to scale the liquidity.

In other words, HMM’s profits will be fully owned by the Haedal Protocol, and all distributions will be aligned with the protocol’s best interests. This is manifested as follows:

• haSUI Treasury: 50% of HMM’s net profits will be periodically harvested and settled in the form of SUI, which will be added to the haSUI treasury, ultimately contributing to the APR amplification of haSUI.

• HMM Reinvestment: A portion of HMM’s net profits will be reinvested into the HMM pool to continually increase its liquidity size. Initially, this percentage will be 40%, gradually decreasing over time to balance between liquidity efficiency and yield distribution.

• HAEDAL Staking Rewards: There will also be a portion of the net profits reserved for Haedal token stakers after its token launch. The percentage will start at 0% on day 1 and gradually increase over time as the HMM pool reaches liquidity saturation.

• Haedal Protocol Revenue: We will take a 10% cut of the net profits as Haedal’s protocol revenue, stored in the protocol treasury, to ensure the long-term sustainability of Haedal Protocol.