# Liquidity Layer

The Liquidity Layer is CurveYield DEX.

CurveYield DEX is designed around unmodified Balancer V3-style pool contracts, with CurveYield-specific factory, fee, routing, and settlement infrastructure. CurveYield's innovation is the economic layer around those pools: fee routing, creator economics, partner revenue, permanent protocol-owned liquidity, settlement automation, yield-bearing asset support, and DAO-controlled incentives.

## AMM foundation

CurveYield uses Balancer-style infrastructure for flexible pool design:

* weighted pools;
* stable-style pools;
* multi-token liquidity;
* pool shares / BPT-style accounting;
* swap routing;
* pool creation through CurveYield wrappers.

Keeping core AMM behavior close to mature Balancer V3-style infrastructure preserves proven pool mechanics while allowing CurveYield to innovate around value routing and liquidity ownership.

## CurveYield economic layer

CurveYield adds support contracts for:

* pool fee policy;
* admin/protocol fee routing;
* creator fee routing;
* partner frontend economics;
* permanent protocol-owned liquidity;
* fee settlement;
* routing and pool discovery;
* DAO-owned liquidity accumulation.

## Fee model

CurveYield pool fees are documented in [CurveYield DEX](/products/curveyield-dex.md). All fee percentages in CurveYield pool policy refer to generated swap-fee revenue, not the full swap amount.

## Permanent protocol-owned liquidity

CurveYield pools can route value into long-term DAO-owned liquidity positions. The canonical explanation is maintained in [Protocol-Owned Liquidity](/products/protocol-owned-liquidity.md).

## Yield-bearing pool assets

CurveYield is designed to support productive assets inside pools: vault shares, liquid locker tokens, boosted staking derivatives, yield-bearing stable assets, and other approved rate-aware assets.

Rate-aware assets require correct pricing. Stable-style pools can use rate providers where appropriate. Weighted pools generally use direct token weighting and do not rely on rate-provider behavior in the basic CurveYield pool design.

## Incentive support

Approved protocol pools may qualify for DAO-funded incentive policies. Current policy details and caps are maintained in [CurveYield DEX](/products/curveyield-dex.md) and [Revenue and Tokenomics](/economics/revenue-and-tokenomics.md).

## Arbitrage-aware execution

AMMs require arbitrage to keep prices efficient. In many systems, all arbitrage value leaves with external bots.

CurveYield's design direction includes hooks, routing logic, and protocol-aligned automation that can improve execution, rebalance markets, and retain some value for LPs, the DAO, or permanent liquidity where deployed. This is a design objective and depends on pool design, competition, gas costs, liquidity depth, oracle behavior, and execution quality.


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