Comparing CLMM and HODLMM
How Zest Protocol CLMM compares with Bitflow’s HODLMM, which also divides prices into bins: what a bin is in each design, and how each moves the price.
Two Kinds of Bin
Zest Protocol CLMM and Bitflow’s HODLMM, both on Stacks, divide a pool’s prices into bins. They differ in what a bin is.
In Zest Protocol CLMM, each bin is a bounded constant-product curve between its two edges, the same curve a Uniswap v3 position one bin wide trades on. The price moves with every trade inside a bin and continues into the next. See How Concentrated Liquidity Works for the bins in detail.
HODLMM follows the Liquidity Book design, which Trader Joe introduced and Meteora’s DLMM uses on Solana: each bin is a constant-sum pool that trades at one fixed price. A trade fills a bin at that price until the bin runs out, then moves to the next bin.
A bin that trades at one fixed price is a price level in an order book. Tokens above the active bin are offers to sell at those prices, tokens below it are offers to buy, and the providers in a bin share its fills pro rata. HODLMM is an order book of pooled price levels; Zest Protocol CLMM is a set of curves.
Side by Side
| Zest Protocol CLMM | HODLMM | |
|---|---|---|
| Inside a bin | A constant-product curve on virtual reserves | A constant sum at one fixed price |
| How the price moves | With every trade, inside a bin and across bins | One bin step at a time, when a bin empties |
| What a bin behaves like | A small concentrated liquidity pool | A resting order at one price |
| Bin width | 1%, 5%, 10% or 20% | 1 to 50 basis points |
| Prices a pool can quote | Any price from 2⁻⁶⁴ to 2⁶⁴ | 1,001 bins around the price set when the pool was created |
| Shaping liquidity | Each bin is already a curve; a range of bins builds a shape | An amount at every price level of the shape |
| Familiar from | Uniswap v3 and the concentrated liquidity exchanges like it | Order books, Liquidity Book and DLMM |
The Difference in Short
Both designs have their place. An order book quotes exact prices level by level. Concentrated liquidity quotes a curve: one deposit gives depth across a whole range, and the price moves continuously as it trades.