Separate Positive and Negative Curves and their Parameters

Ampleforth Governance
1

Summary:

This proposal introduces an update to the rebase curve logic that enables separate responsiveness parameters for positive and negative rebases. It also proposes restoring the deviation threshold to 5%, reversing the reduction to 2.5% introduced in Proposal #32.

The proposed update, implemented in PR #297, allows independent control over the steepness of the positive and negative sigmoid curves—unlocking more balanced and purposeful rebase behavior.

Background & Context:

  • AIP-5 introduced the sigmoid rebase curve, replacing the previous linear model with a more symmetric and bounded mechanism.

  • Proposal #32 adjusted the curve’s growth parameters to steepen the sigmoid, with the goal of tightening price distribution and accelerating convergence to equilibrium.

The steepening successfully achieved its primary objective: it virtually eliminated long periods of consecutive negative rebases during demand contractions, allowing the supply to correct more decisively and quickly reach equilibrium.

However, because the same steepness was applied to both positive and negative rebases, it introduced a new issue:

  • Positive rebases became overly aggressive, often overshooting demand.

  • This oversupply led to unnecessary negative rebases shortly afterward, adding noise and volatility.

  • In parallel, the deviation threshold was lowered to ±2.5%, which has proven too sensitive—causing the system to react to insignificant price movements.

What this proposal is:

  • Enables asymmetric sigmoid parameters — allowing different steepness for positive and negative rebases.
  • Preserves a sharp negative rebase curve — useful for rapid correction during demand drops.
  • Smooths the positive rebase curve — reducing overreactions to short-term price moves.
  • Restores the deviation threshold to ±5% — filtering out noise and reducing false rebase triggers.

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3 Likes
2

I’m in favor of widening the neutral zone, but not sure about the steepening of the negative rebase curve part.

It’s difficult to see on the chart, but it looks to me as if we are jumping from 0% rebase to -5% rebase within a tiny price movement of 0.01$ from 0.95$ - 0.94$.

This seems very sudden to me and might create volatility around 0.95c by users trying to avoid a -5% rebase and creating a selfulfilling dynamic. I know there is VWAP, but still.

Could you maybe provide us a table showing at what price levels each % of the negative rebase is happening?

2 Likes
3

Could you please elaborate on this one? How we know its over shooting demand? Thank you.

1 Like
4

I don’t think we need to steepen the negative rebase. Since the last reconfiguration of the rebase ample has corrected quickly when in negative territory. I support expanding the neutral bounds, but the possible benefits of steepening the negative rebase don’t seem necessary in opinion.

5

It is not a wise choice to blunt/dull AMPL’s market perception capabilities.