How Market Makers Benefit
How To Make More Money Making Markets With Rook
TLDR: Rook is the most convenient, secure and profitable network for on-chain market makers for two main reasons: 1. One single integration to access all DeFi and CeFi liquidity: Integrating with Rook is the only integration you'll need, as it provides a single point of entry to access all on-chain (DEXs) and even off-chain liquidity (CEXs). Your orders will be arbitraged against Rook users, other market makers, UniswapV3, UniswapV2, UniswapV1, Curve, Balancer, Bancor, Binance, Coinbase, etc. If there is arbitrage with your order and any of these sources, a keeper will execute it on your behalf. 2. Rook provides market makers with three different profit mechanisms to make money on every trade they make:
  1. 1.
    Capture spreads or hedge fills
  2. 2.
    Earn Arbitrage Rewards in ROOK on every trade

Rook: The Next Evolution in On-Chain Market Making

Before Rook, DeFi asked market makers to execute their own trades. That means they themselves had to navigate gas, fees, liquidity, bridging, routing, L2s, settlement, and MEV, just to make a trade. Because of these on-chain trading inefficiencies, on-chain traders unnecessarily lose billions of dollars every year fighting a hopeless battle against complexity. With the launch of the Rook Protocol this has become a relic of the past.
Rook allows MMs to outsource the execution of their orders to the world's best execution artists, and get paid to do so.
The introduction of our Rook Protocol signals the next evolution in DeFi trading. By introducing a decentralized economy of Keepers - expert trade executors - traders can now outsource all these inefficient aspects of on-chain market making to the world's foremost experts: Keepers.
Say goodbye to suffering from high network fees, trading fees, illiquidity, bad routing, expensive cross-chain bridging, complex settlement, and risk of MEV attacks.
Using Rook, you can focus your efforts on what you do best - market making - while our Keepers take care of the rest, in the most efficient and profitable way. And because Keepers use your orders to capture and redistribute arbitrage profits back to you, you’ll in essence get paid to outsource the trade execution to them.

Why Market Making through Rook is better than anywhere else in DeFi

Plugging into Rook's execution layer gives on-chain market makers a host of unique-in-DeFi benefits:

Reason #1: One-stop access to all the liquidity in DeFi and CeFi

Because our Keepers can access liquidity from virtually anywhere in DeFi and CeFi, plugging into the Rook Protocol is the only integration you'll need to maximize your liquidity coverage. Keepers will find the right liquidity sources, use the most efficient routing, and choose the optimal settlement method, all while paying you in ROOK for the privilege of executing your order.

Reason #2: Comprehensive MEV protection

Through using our grey pool, The Hiding Book, all your trades will be protected from MEV attacks.

Reason #3: Earn Arbitrage Rewards on every trade

Our network allows market makers to get rewarded in ROOK while capturing spreads on every trade. Your orders create arbitrage opportunities for our Keepers, which they’ll share with you.

Reason #4: (Actual) Free Trading

Trades through the Rook Protocol are completely free. You don't pay network fees (gas), nor trade fees or any other premium.

Reason #5: Arbitrage as a service

Arbitraging markets as a market maker is a chore. Using the Rook Protocol, our Keepers will do the arbitraging for you. This is an easy way for market makers to arbitrage against all the top exchanges in DeFi without having to integrate with them yourself.
On-chain market making through Rook provides MMs with all of the benefits, and none of the inefficiencies

Three Distinct Profit Opportunities Per Trade

Because we provide market makers access to the world’s first coordinated economy of Keepers, Rook is able to provide market makers with three different ways to make profit on every trade they make:
  1. 1.
    Capture spreads or hedge fills
  2. 2.
    Earn Arbitrage Rewards in ROOK on every trade
  3. 3.
    Weekly Market Maker Pilot Program Rewards

Profit Mechanism 1: Hedge and capture spreads across exchanges

Using our network, it’s business as usual for your current market making operations, except now without paying network fees (gas) or trade fees.
  • MMers can capture bid/ask spreads directly on Rook
  • MMers can hedge fills on Rook against other exchanges to capture spreads that exist across exchanges. Example: When you sell 1.0 WETH on Rook, you can buy 1.0 WETH on Coinbase/Binance/FTX/OTC/etc to capture a spread against another source.

Profit Mechanism 2: Earn Arbitrage Rewards in ROOK on every trade

Rook is built to be the long-term vehicle for sustaining profitability for on-chain market makers. Every order you place through Rook will return you the lion’s share of the arbitrage opportunity your order created across DeFi and Cefi, in the form of ROOK.
How it works:
  1. 1.
    The market maker places an order on Rook
  2. 2.
    That order is filled by a Keeper that bid X amount of ROOK to earn the right to fill the order.
  3. 3.
    The market maker earns 80% of X ROOK bid by the Keeper
  • Market Maker has 100 orders filled for the day.
  • Keepers bid an average of .5 ROOK to fill the 100 orders, totaling 50 ROOK. 80% * 50 ROOK = 40 ROOK, which is what the market maker earns over the 100 transactions as a bonus they make in addition to their trading profits.
MEV Bid Distribution

Profit Mechanism 3: Weekly MM Rewards from Pilot Program

Over the coming 6 months, participating market makers will earn an average of $520,000 in ROOK rewards just from this program. During that time, a dominating market maker has the potential to earn as high as ~$1,560,000. We’ll likely run this program again during the second half of 2022 as well.
You can read more about our Pilot Program here: