# Target Liquidity Auctions (TLAs)

{% hint style="info" %}
**TL;DR:** Target Liquidity Auctions on Hypershot use a dual-price mechanism. Buyers bid for tokens to meet the target liquidity, ensuring price stabilization and immediate liquidity for trading on HyperEVM DEX.
{% endhint %}

## A Transformative Approach

At the core of Hypershot lies the innovation of **Target Liquidity Auctions (TLAs)**, a groundbreaking mechanism that seamlessly integrates token creation with liquidity deployment.&#x20;

TLAs are designed to simplify fundraising, provide immediate market utility, and offer scalability for both emerging and established projects.

***

### **Key Features of TLAs**

TLAs stand out due to several defining features:

1. **Time-Limited Auctions**\
   TLAs are conducted within fixed windows, tailored to the type of launch:
   * *Instant Launches* are fast-paced, lasting 24 to 48 hours, designed for smaller creators or projects requiring swift execution.
   * *Partnered Sales* span up to 72 hours, catering to larger-scale initiatives with ambitious goals and tailored options.
2. **Dynamic Pricing via a Bonding Curve**\
   TLAs utilize a Bancor curve to adjust token prices dynamically based on demand:
   * Early participants gain access to tokens at lower prices, incentivizing rapid engagement.
   * As demand increases, the price rises proportionally, ensuring market-driven price discovery.
3. **Progressive Liquidity Deployment**\
   Liquidity is deployed in stages tied to specific milestones—25% and 100% of the fundraising target. This phased deployment guarantees early market activity and deeper liquidity throughout the auction.
4. **Immediate Post-Auction Liquidity**\
   When the auction concludes, all funds raised are directed into a liquidity pool on Hyperliquid EVM. This ensures tokens are tradable on decentralized exchanges (DEXs) like HyperSwap from day one, fostering an active trading ecosystem.

***

### **Tailored Launch Types for Different Projects**

TLAs offer flexibility through two primary launch models:

* ***Instant Launches***: These prioritize speed and simplicity, with no vesting mechanisms. Tokens are fully unlocked, immediately accessible, and tradable post-purchase, making them perfect for straightforward token sales.
* ***Partnered Sales***: Tailored for strategic fundraising, these sales incorporate vesting schedules and allow for customization. They are ideal for projects seeking long-term alignment with their backers while introducing liquidity gradually.

***

## Leveraging the Bancor Formula and Bonding Curves in Hypershot

Hypershot integrates advanced Bonding Curves mechanisms and the **Bancor Formula** to enable dynamic pricing and an automated token market.

#### Overview

1. **Bonding Curves**:\
   Bonding curves act as Automated Market Makers (AMMs), allowing tokens to be minted and burned based on predefined pricing formulas. They reduce market information asymmetry by providing transparent, demand-driven price signals.

Typical pricing function:

$$
𝑓
(
𝑥
)
=

𝑚
𝑥
𝑛
$$

where 𝑥  represents the circulating supply of tokens.

1. **Connector Weight (CW)**:\
   Introduced in the Bancor formula, CW determines the ratio between collateral and market capitalization. It enables dynamic adjustments to the slope and shape of Bonding Curves, allowing flexibility to adapt to market changes.
   * Example pricing formula:&#x20;

$$
Price=
Collateral/(Token Supply×CW)
​
$$

#### Disclaimer <a href="#disclaimer" id="disclaimer"></a>

HyperEVM is still under development, and the precompiles required for this feature are not fully documented. As a result, this integration may be subject to change or may not be realized in its described form.
