MEXC Exchange Research: Solana-based DEX Platform Orca

3 min readSep 27, 2021

Source: Orca

Orca is a user-friendly decentralized trading platform on the Solana blockchain. It prompts users to trade by comparing the current transaction price with the price difference on CoinGecko and whether the slippage meets user requirements. As of September 24, the TVL (total locked value) of the Orca platform is $434 million.

Fair Price Indicator

When trading on Orca, the system automatically checks for two conditions, showing a green flag if satisfied and an interest rate warning or a sliding point warning if not.

1. Price deviation between market price and CoinGecko is less than 1%

2. The slippage is less than or equal to the set slippage limit (default 1%)

Token balance

In Orca, a trading panel is provided to show the balance of the tokens held.

Pricing curve

Orca uses the same Constant Product Curve (x*y=k) by Uniswap for pricing. For stabilizing token transactions, the plan is to use the curve.fi stable curve for pricing.

X is the number of tokens, Y is the number of SOLs and K is the constant. The issuer of X creates a trading pool at a certain ratio and determines the price of the new token, that is, the ratio of X to Y. Since X and Y are the constant product, X and Y has a reciprocal relationship. When someone purchases a new X in this contract, the number of Y increases.

Simply put, the X*Y=K pricing mechanism determines which side to buy in large quantities and the corresponding token price will rise. So, as long as someone keeps buying X, the price of X will continue to rise.