---
# System prepended metadata

title: Distill - NFT AMM

---

# Distill - NFT AMM

## LIquidity Providers

### Token-Asset Providers

Lps may bring any number of non fungible tokens and any amount of fungible ERC20 assets to the pool.

### Clone Providers

An LP may provide a clone only to the pool. This action augments the token reservers as if there is more liquidity in the pool. A clone's worth must meet or exceed the minimum requirements of the pool.

## LP Tokens

### Option A: Multi Tokenization

#### ERC4626 Vault Shares

An LPs fungible assets provided as liquidity is represented as standard ERC4626 vault shares.

#### ERC20 Sortition Tokens

Each underlying non-fungible token provided to the pool as liquidity is then abstracted as an ERC20 token to it's provider. When an NFT is sold **BY** the pool a single token is selected at random and burned. When an NFT is sold **TO** the pool a single token is selected at random and it's owner is minted another token.

The tokens are redeemable for a randomly selected tokenId from the pool.

#### ERC721 Clone Positions

When an LP provides a clone to the pool thier position is represented as an ERC721 token tracking their provided cloneId's and the tokens backing those clones.

#### Advantages:

- Composability with well known and accepted standards.

- Liquid and fungible positions.

#### Disadvantages:

- Complexity when entering and exiting positions.

- unforseen consequences with the ability to seperate position equalities?

### Option B: Tokenization as ERC721

An NFT representing the clone position is minted keeping track of the cloneId's and their values.

#### Each Position as A Single Token

Positions may be represented by an ERC721 token encoding:

- The position's share of the assets pool.
- The clone Id's and their values deposited into the position.
- The position's claims on the NFTs in the pool.

The claims accounted for in the ERC721 token would behave in the same way as the sortition tokens described above.

#### Advantages:

- Simpler interface for entering and exiting positions. 

- No additional complexities created by ability to split a positions equalities.

#### Disadvantages:

- Non standard interfaces and interaction with positions.

## Ditto Auctions

### Clone Ejected from Pool

### Underlying NFT Traded for Clone

## Swaps

### NFT for Tokens

### Tokens for NFT