Negative Interest: Zeta Adjustment#599
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1. `shareReservesDelta` and `bondReservesDelta` always refer to the amount of shares or bonds that are being added or subtracted from the share reserves. 2. `shareCurvePayment` refers to the amount of shares priced by the curve. We think of this as a payment because the LPs are paying shares in return for a proceed in bonds, `bondCurveProceeds`.
* Added a `minSharePrice` * Fixed some tests * Fixed the Rust codebase
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jrhea
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lgtm, just a question about one of the tests
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This PR originally included changes that modified the share adjustment logic to correct for negative interest adjustments that would break our k-invariant. These changes were mostly included in other negative interest PRs.
This PR fixes the tests related to k invariance ad path independence. We have path invariance on the curve in the sense that the effective share reserves and bond reserves coordinates are invariant under trading without liquidity changes caused by
addLiquidityandremoveLiquidity. We do not have path independence if we instead look at the triple(shareReserves, shareAdjustment, bondReserves). This can be explained by the fact that some traders may have accrued negative interest while others haven't. If the negative interest trader gets the best price available, more of the LPs liabilities or proceeds will be susceptible to the scaling from negative interest. Re-ordering trades can change the amount of negative interest adjustments that are applied to the reserves.Along with fixing tests to verify the zeta adjustment changes, this PR also includes a fix to
openShort. Prior to this PR, shorts benefitted from negative interest that accrued in their checkpoint. In extreme cases (like those of a bad hack), shorts could be opened for free. This PR closes this loophole by clamping the share price to the open share price. The_minSharePricefield gives shorts an easy way to prevent themselves from opening a short in a checkpoint with negative interest.