Become a BAL provider by adding liquidity to any perpetual market. By doing so, BAL providers increase the liquidity depth and collateralisation of that market.

The liquidity you provide is represented by BAL shares and is comparable to collateral consumed by open unfilled orders. Providing liquidity with leverage is optional and will increase an BAL provider's risk of liquidation.

After liquidity has been added, BAL providers will automatically take on a share of the vAMM's positions as a counterparty to Drift traders. These positions are automatically acquired and adjusted as new trades are filled.

For example, if a BAL provider starts providing 10% of the liquidity to the vAMM in the SOL market, and then a taker opens a 10 SOL long position, then the BAL provider will receive a 1 SOL short position, plus fees earned for the trade.

You can examine each market's performance over time. Note that individual BAL provider performance is dependant on when you entered.

Yes, but it's best to separate trading activity and BAL providing into different accounts to track P&L effectively.

Yes. While the vAMM tries to maintain 0 inventory, it's possible for BAL providers to accumulate large directional positions at times. This can lead to losses even with a small amount of BAL shares or with 1x leverage.

BAL providers are compensated for this risk by earning fees but are not guaranteed to profit.

80% of the fees gathered by the vAMM are distributed among BAL providers based on the proportion of liquidity each BAL provider contributes to the perpetuals market. BAL providers also receive a portion of funding and any P&L from settled positions. These returns will be reflected in your unsettled/settled P&L.

The returns shown on this page are based on historical performance. Note that individual BAL provider performance is dependant on when you entered.

The protocol enforces perp positions to be a multiple of the step size. But because BAL providers split fills with other users and they may get a position that isn't a multiple of the step size. When BAL shares are removed, any remaining amount of the position (residual) that is below the step size is burned, resulting in a small fee.