How to use
- Set the monthly retainer, loan + option token share (% of supply), hybrid token allocation (% of supply), and total supply.
- Specify the option strike price and expected token price in 12 months.
- The cards compare three models: pure retainer, loan + call option, and hybrid (half retainer + separate token allocation).
- The “Loan + call option” card shows the option profit to the MM plus the nominal loan value (tokens × current price) so the project sees the full token exposure, even when the option is out-of-money.
- The hybrid model uses a separate token allocation slider (0.5–1% of supply), matching the industry convention. It does not reuse the loan+option allocation.
- The hybrid retainer is set to 50% of the pure-retainer rate, since tokens compensate the balance. This 0.5× convention is a common market practice for hybrid MM deals.
- The cheapest model is highlighted in purple, the most expensive gets a red border.
Typical industry retainer band is $15K–$50K/mo for standard MM engagements; the slider allows up to $75K/mo for higher-tier deals.
Calculator
Market Making Cost over 12 Months
Fixed retainer
$0
fixed fee
Loan + call option
$0
option cost
loan value at current price
Hybrid
$0
retainer + tokens
Formulas
Retainer = Monthly × 12
- Monthly — monthly fixed fee paid to the market maker ($)
- Retainer — annual cost of the retainer model (computed)
Tokens = Supply × MM_share_% / 100
- Supply — total token supply (units)
- MM_share_% — percentage of supply allocated to the market maker under the loan + option model
- Tokens — derived number of tokens provided to the MM (computed, units). Shown next to the slider in the UI (e.g., “3.0% = 3,000,000 tokens”).
Option = Tokens × max(0, Price - Strike)
- Tokens — number of tokens provided to the market maker (units, computed as Supply × MM_share_% / 100)
- Price — expected market price of the token in 12 months ($)
- Strike — option strike price ($)
- Option — option profit captured by the MM (computed); displayed as the “cost” line on the card. Equals zero if Price < Strike — but the project has still loaned
Tokensunits to the MM, and that loan value is surfaced separately on the card.
Loan_value = Tokens × Price
- Tokens — number of tokens loaned to the MM under the loan + option model
- Price — current (or expected) token price ($)
- Loan_value — nominal value of the loaned tokens at the current price (computed). Not treated as cost in the comparison (loan is returnable), but shown to the user so that the in-kind exposure is visible even when the option is out-of-money.
Hybrid = 0.5 × Retainer + Hybrid_tokens × Price
- Retainer — annual retainer from the fixed-fee model ($)
- Hybrid_tokens — tokens allocated to the MM under the hybrid model (units, computed as Supply × Hybrid_share_% / 100);
Hybrid_share_%is a separate input (0.5–1% of supply) and does not reuse the loan+option share - Price — expected market token price ($)
- Hybrid — hybrid model cost (computed): half retainer + market value of the hybrid token allocation. The 0.5× retainer coefficient reflects a standard market convention: hybrid retainers are typically set at 50% of the pure-retainer rate because tokens compensate the balance. Tokens are valued at market price, not through strike/exercise.