Liquidity and price impact

Contango positions are built on top of spot and money markets: this liquidity amounts to a total of $60B across defi. Deep liquidity means minimal price impact for traders.

Obviously, each instrument listed on Contango has its own specific liquidity, depending on the money market and chain selected by the trader. For instance, ETH/DAI on Aave on mainnet is likely to be highly liquid, whereas a more exotic asset like PTeETH/ETH on Silo on Arbitrum might not be as liquid.

The choice of a specific chain and money market is completely up to the trader. Contango is only in charge of sourcing the best spot liquidity to execute the swap that is required to open, modify or close a position (see this section for more details). To achieve this, Contango uses Balmy (ex Mean Finance), which is a meta aggregator of spot markets. Slippage parameters for this swap can be adjusted after clicking the 'review trade' button. After clicking the 'review trade' button, Contango also shows the market impact of your trade on the rates.

Before trading → always adjust your slippage parameters and check the underlying liquidity you're trading on, by clicking in the dropdown arrow of the money market you selected; also check the final market impact of your trade on the rates by clicking on the 'review trade' button.