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Overview

Ekubo is a concentrated liquidity AMM (Automated Market Maker) on StarkNet, similar to Uniswap V3. Sable integrates Ekubo in the Apex vault to generate LP fees from market making.
Apex vault allocates 35% of deposits to Ekubo LP positions for maximum diversified yield.

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What is Ekubo?

Ekubo is a next-generation DEX on StarkNet featuring:
  • Concentrated liquidity: LPs provide liquidity in specific price ranges
  • Capital efficiency: Higher returns per dollar of liquidity
  • LP fee generation: Earn fees from every swap
  • Multiple fee tiers: 0.01%, 0.05%, 0.3%, 1% fee pools

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Key Features

  • Price Range Orders: Set custom min/max prices for your LP position
  • Auto-compounding: Fees can be auto-compounded into positions
  • Non-custodial: Users retain full control of liquidity
  • ERC-721 Positions: Each LP position is an NFT

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How Sable Integrates with Ekubo

Sable uses Ekubo exclusively in the Apex vault as part of its multi-strategy approach.

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Apex Vault Strategy

Risk Level: 5 (High)
Allocation: 
┌──────────────────────────────────────┐
│        APEX VAULT ALLOCATION        │
├──────────────────────────────────────┤
│  40%  Vesu Leverage Lending        │
│       (PRIME pool, 3-5x loop)      │
├──────────────────────────────────────┤
│  35%  Ekubo LP                     │
│       (WBTC-ETH or WBTC-USDC)     │  ◄── EKUBO INTEGRATION
├──────────────────────────────────────┤
│  25%  Endur Staking                │
│       (xWBTC liquid staking)      │
└──────────────────────────────────────┘

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LP Strategy Flow

Apex Ekubo Flow:
  1. User deposits WBTC to Apex vault
  2. Vault allocates 35% to Ekubo LP
  3. Vault creates concentrated liquidity position:
     ├── Pair: WBTC-ETH or WBTC-USDC
     ├── Range: ±10% around current price
     └── Fee tier: 0.3% (standard)
  4. LP position earns fees from swaps
  5. Fees auto-compound into vault

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Yield Sources

The Ekubo LP component contributes to Apex’s overall yield:
ComponentYield
Vesu Leverage (40%)~15-20% APY
Ekubo LP (35%)~8-12% APY
Endur Staking (25%)~4-6% APY
Blended Total~12-15% APY

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Concentrated Liquidity Basics

Unlike traditional AMMs (constant product x × y = k), Ekubo uses concentrated liquidity:

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Traditional AMM

Liquidity spread across entire price curve (0 → ∞)
──────────────────────────────────────────
       │
       │    ┌─────────────────
       │   ┌┘ Thin liquidity everywhere
       │  ┌┘
       │ ┌┘
───────┼──────────────────────────────────
       0               Price

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Concentrated Liquidity (Ekubo)

Liquidity concentrated in active price range
──────────────────────────────────────────
       │
       │           ┏━━━━━━━━┓
       │           ┃ Thick  ┃ Deep liquidity in range
       │           ┃ liq.   ┃ = more fees earned
       │           ┗━━━━━━━━┛
───────┼───────────┼─────────┼────────────
       0            Min      Max    Price
Benefits:
  • Higher capital efficiency: Same fees with less capital
  • Better for LPs: Earn more per dollar deposited
  • Better for traders: Tighter spreads, less slippage

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LP Fee Generation

Ekubo LPs earn fees from every swap that passes through their liquidity range.

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Fee Structure

Fee TierUse CaseExample Pair
0.01%Stablecoin pairsUSDC-USDT
0.05%Correlated assetsETH-wstETH
0.3%Standard pairsWBTC-ETH
1%Exotic/volatile pairsLow-volume tokens
Apex vault uses the 0.3% fee tier for WBTC-ETH or WBTC-USDC pairs.

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Fee Calculation Example

LP Position:   1 WBTC + 100 ETH in WBTC-ETH pool
Daily Volume:  $10,000,000 through your range
Fee Tier:      0.3%
Your Share:    0.5% of pool liquidity

Daily Fees = $10M × 0.3% × 0.5% = $150/day
Annual Fees = $150 × 365 = $54,750/year

Position Value:  $200,000
LP APY:          $54,750 / $200,000 = 27.4% APY
Actual APY depends on trading volume, pool utilization, and how much of the volume passes through your specific price range.

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Impermanent Loss Considerations

Concentrated liquidity positions are exposed to impermanent loss (IL) when prices move outside the range.

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What is Impermanent Loss?

Scenario:
  LP deposits:  1 WBTC ($100k) + 100 ETH ($100k)
  Total value:  $200k
  
  BTC doubles in price:
    LP position rebalances to ~0.7 WBTC + 141 ETH
    Value: $210k (would be $220k if you just held)
    IL: -$10k (-4.5%)

IL is "impermanent" because it disappears if price returns to original level.

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Apex Vault IL Mitigation

  1. Tight price ranges: ±10% reduces IL exposure
  2. Fee income offsets IL: High volume pairs generate fees faster than IL accrues
  3. Correlated pairs: WBTC-ETH moves relatively in sync, reducing IL
  4. Diversification: Only 35% of Apex is exposed to IL risk

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Contract Integration

Apex vault interacts with Ekubo to manage LP positions. 
// Simplified Cairo pseudocode

#[external(v0)]
fn deploy_to_ekubo(wbtc_amount: u256) {
    // Calculate pair amounts (e.g., 50/50 WBTC-ETH)
    let eth_amount = calculate_pair_amount(wbtc_amount);
    
    // Approve tokens to Ekubo pool
    wbtc.approve(ekubo_pool, wbtc_amount);
    eth.approve(ekubo_pool, eth_amount);
    
    // Create concentrated liquidity position
    let position_nft = ekubo_pool.mint(
        wbtc_address,
        eth_address,
        fee_tier: 3000,        // 0.3% fee
        tick_lower: -2000,     // Min price
        tick_upper: 2000,      // Max price
        amount0: wbtc_amount,
        amount1: eth_amount
    );
    
    // Store position NFT ID
    self.ekubo_position.write(position_nft);
}

#[external(v0)]
fn withdraw_from_ekubo() {
    let position_nft = self.ekubo_position.read();
    
    // Collect accrued fees
    ekubo_pool.collect(position_nft);
    
    // Remove liquidity
    let (wbtc_out, eth_out) = ekubo_pool.burn(
        position_nft,
        liquidity: full_amount
    );
}

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Which Sable Features Use Ekubo?

Apex Vault

35% Ekubo LP AllocationApex is the only Sable vault that uses Ekubo.
  • Pair: WBTC-ETH or WBTC-USDC
  • Fee tier: 0.3%
  • Range: ±10% around current price
  • Yield: ~8-12% APY from LP fees
  • Risk: Impermanent loss exposure

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Frontend Integration

Sable displays Ekubo LP yield in the Apex vault APY breakdown. 
// From: ~/workspace/source/src/lib/api/vaults.ts

const apexApy = {
  vesuvLeverage: 18.5,  // 40% allocation
  ekuboLP: 10.2,        // 35% allocation
  endurStaking: 4.8,    // 25% allocation
  
  // Weighted average
  total: (18.5 * 0.4) + (10.2 * 0.35) + (4.8 * 0.25),
  // = 7.4 + 3.57 + 1.2 = 12.17% APY
};

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Risk Considerations

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Benefits

  • High APY: LP fees can exceed base staking/lending yields
  • Diversification: Reduces correlation risk with pure lending strategies
  • Market making revenue: Earn from trading volume

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Risks

  • Impermanent Loss: Price divergence reduces returns
  • Smart contract risk: Ekubo protocol vulnerabilities
  • Range management: If price moves out of range, no fees earned
  • Complexity: Multi-asset LP positions harder to unwind

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External Resources

Ekubo Documentation

Official Ekubo protocol documentation

Ekubo App

Ekubo DEX and LP interface

Concentrated Liquidity Guide

Learn more about concentrated liquidity mechanics
Integration Source Code: ~/workspace/source/contracts/src/apex.cairo

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