TWAP

Introduction to dTWAP

TWAP (Time-weighted Average Price) is a common order type used in CeFi that breaks an order into smaller trade sizes and executes them at regular intervals. The main goal of a TWAP order is to reduce the order’s price impact. It can also be useful if a user wants to implement a dollar-cost averaging strategy (DCA) and buy a certain token on a consistent schedule (i.e. once a month).

Therefore, TWAP is best used when the order size is large compared to the available liquidity, or when a user anticipates a high price volatility period with no clear up or downward trend.

THENA has integrated the dTWAP protocol, powered by Orbs, that brings this order type to DeFi in a decentralized manner. Users can use this tool to create dTWAP orders by following the directions below.