A user can interact with Nebula Protocol through one or more roles, described below.
A trader simply holds, or buys / sells various cluster tokens, and includes them in their portfolio to gain passive exposure to trading strategies expressed through the combination of clusters.
# Liquidity Provider
A liquidity provider deposits cluster tokens and UST in one or several liquidity pools recognized by Nebula Protocol and stakes their LP positions to earn NEB token rewards.
As opposed to clusters and indices being managed and rebalanced by centralized parties, Nebula instead implements multiple incentive mechanics into the protocol to encourage the community and the protocol's users themselves to help maintain the clusters' asset allocation. This allows for a significantly more transparent and efficient cluster maintenance.
A rebalancer engages in rebalancing, minting, and burning operations against clusters. Users are incentivized to act as rebalancers in 2 primary ways:
- For rebalances that bring the cluster composition closer to the target allocation, the protocol providers users with a discount on either the cluster tokens when minting, or the underlying assets when burning.
- The amount of reward that they earned is determined by the cluster's penalty function
- During the early days of the protocol, users will also earn NEB rewards on top of the discount to further incentivize rebalances
A rebalancer's role is often combined with an arbitrageur's as both operations can be performed together in a single transaction.
An arbitrageur engages in buying and selling cluster tokens across various markets and liquidity protocols to rectify any price differences between the market price and the net asset value (NAV) of the cluster.
Nebula Protocol sponsors various arbitrage strategies against certain protocols such as Astroport through incentive campaigns, which rewards qualifying trades with NEB rewards. You can find the possible arbitrage scenarios here.
A voter stakes their NEB tokens to gain voting power in protocol governance. In addition, voters accrue NEB rewards while their tokens are staked and as they actively vote and participate in governance polls. More info on the Nebula governance token and protocol governance here.
# Privileged Roles
The following roles hold privileged access to core components of Nebula or require direct interaction with the Nebula development team (such as integration with the web app). By corollary, these roles are assigned democratically through Governance.
# Cluster Manager
A cluster manager is an entity or organization responsible for administering various points of operation for a cluster. Although all components of clusters can be entirely decentralized, certain clusters may be approved via governance to have some aspects controlled by a trusted operator.
Potential examples of cluster manager roles include:
- holding keys (often multisig) that control the recomposition oracle
- maintaining bots that implement a cluster's asset reallocation scheme
- monitoring cluster activity and proposing parameter updates via governance